Clashes Erupt Before Greek Austerity Vote

ATHENS—Clashes broke out between dozens of anarchists and police in front of Greece's parliament Wednesday, just ahead of a vote on a five-year austerity plan the country needs to pass to avoid default.

Eye witnesses said that demonstrators smashed marble paving stones in the Athens central square and threw rocks at police, prompting them to respond by firing tear gas and clearing the area of people in front of Parliament.

The violence dispersed an otherwise peaceful demonstration of about 10,000 people that had gathered for a second day to march against the €28.4 billion ($40.81 billion) billion austerity plan. Parliament is due to vote on the austerity package later Wednesday.

Passage of the additional spending cuts and new taxes has been set as a condition for another international bailout to keep Greece from defaulting on its debt. The stakes are immense. If the government fails to carry the vote, European financial markets could nosedive in anticipation of a deepening crisis for the euro and for government-debt markets.

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Protestors clash with riot police during a 48-hour general strike in Athens on Wednesday. Protestors clashed with police, who fired tear gas several hours before the Greek Parliament was to vote on an austerity package.

The Socialist government controls 155 seats in Greece's 300-member parliament and needs a simple majority of 151 votes to pass the measures. Despite earlier wavering by four lawmakers within its ranks, that majority now appears to be holding.

"I'm optimistic about the future of the country," government spokesman Elias Mossialos told a morning television news program. "I think the entire Socialist parliamentary group will vote for the measures." One of the four Socialist Party dissenters—Thomas Robopoulos from the northern Greek city of Thessaloniki—said he would vote for the package, the Alter private-television channel reported early Wednesday.

According to private broadcaster SKAI, a second wavering Socialist, Alekos Athanasiadis, has now withdrawn his earlier dissent and will also vote to support the package. In addition, the two other rebels are believed to have softened their opposition, while there are indications that the government could pick up a handful of votes from one of Greece's smaller opposition parties, Democratic Alliance, which controls five seats in parliament. The party announced this week that it would allow its members to "vote their conscience," meaning that some of their parliamentarians may now also swing behind the government.

Analysts also don't rule out that one or two members of the main opposition New Democracy Party may break ranks and vote with the Socialists—although they would face expulsion from their party.

"Barring last-minute surprises, political analysts anticipate that the bill will secure the backing of 154 ruling-party deputies [and potentially a few from the opposition]," HSBC Pantelakis Securities said in a research note.

Greece faces another critical test Thursday, when parliament will hold an article-by-article vote on the legislation implementing the austerity plan and a promised €50 billion privatization program. But with the overall outlines of the austerity plan expected to pass Wednesday, the vote on the implementing legislation is expected to be a formality.

The opposition New Democracy Party has pledged to support large parts of the implementing legislation, including the articles relating to privatizations and cutting public spending—although it opposes the tax increases outlined in the bill.

The center of Athens was cordoned off early Wednesday by thousands of police bracing for a second day of violent protests over the austerity plan, which many Greeks believe will lead to further job losses and bigger burdens on households.

Protesters from a new, grass-roots movement of self-styled "indignant" Greeks have vowed to encircle the parliament building to prevent lawmakers from voting on the package. At the same time, Greece's two major umbrella unions—which have declared a 48-hour general strike—are also planning fresh protests Wednesday.

In May last year, Greece narrowly avoided default with the help of a €110 billion bailout from its euro-zone partners and the International Monetary Fund. But still facing prohibitively high borrowing costs on international markets, Greece is now seeking about €100 billion in fresh aid.

The European Union and IMF, however, have demanded that the country pass the austerity plan, the implementing legislation and the privatization program before they will release existing funds to the country or agree to a new aid package.

Greece faces a cash crunch in mid-July and is counting on euro-zone finance ministers to release the next tranche of its existing loan before then. The parliamentary vote is timed to precede a special meeting of those ministers July 3 at which they will decide whether to release that disbursement.

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