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Greek politics in disarray after call for rescue-plan referendum

November 1, 2011 |  7:49 am

Greece
REPORTING FROM ATHENS — Greece was in political disarray Tuesday after Prime Minister George Papandreou's surprise decision to put the euro rescue plan to a national referendum, a move that caused at least one lawmaker to quit the ruling party and others to call for the premier's resignation.

Milena Apostolaki defected from Papandreou's Socialist Party a day after the Greek leader announced that he would allow his angry, austerity-saddled compatriots to vote on the debt-crisis plan crafted last week by European leaders. Apostolaki's resignation leaves the Socialists hanging by a thread, with only a two-seat majority in the 300-member parliament.

Six other party members called for the prime minister to step down, and opposition lawmakers are considering resigning en masse by Friday, before a confidence vote that Papandreou called in parliament in hope of shoring up support within his fractious party.

With such a tiny majority, Papandreou's government is potentially too weak to carry out the tough additional cost-cutting measures demanded by international lenders that have given Athens billions of dollars in emergency loans.

The decision to hold a referendum, likely to be held in January at the earliest, alarmed officials of other European nations. It also sparked steep losses Tuesday in the continent's stock markets, including Greece's, which tumbled more than 7%.

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— Anthee Carassava

Photo: Electricity customers line up in Athens on Tuesday to ask about a new property tax that is to be included in energy bills under a series of austerity measures taken by the debt-strapped Greek government. Credit: Thanassis Stavrakis / Associated Press.

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