HISTORYTHE MODERN GREEK NATION2007
Vast forest fi res
devastate much of the
western Peloponnese
as well as parts of Evia
and Epiros, causing
Greece’s worst
ecological disaster in
decades. Thousands
lose their homes and
66 people perish.2007
General elections are
held in September
and the conservative
government of Kostas
Karamanlis returns
to power for a second
consecutive term.for the city. However, rising unemployment, ballooning public debt, slow-
ing infl ation and the squeezing of consumer credit took their toll. Public
opinion soured further in 2007 when Kostas Karamanlis’ (the nephew of
Konstandinos Karamanlis) conservative government (who had come to
power in 2004) was widely criticised for its handling of the emergency
response to severe summer fi res, which were responsible for widespread
destruction throughout Greece. Nevertheless, snap elections held in Sep-
tember 2007 returned the conservatives, albeit with a diminished majority.
Over recent years, a series of massive general strikes and blockades
highlighted mounting electoral discontent. Hundreds of thousands of
people protested against proposed radical labour and pension reforms
and privatisation plans that analysts claim would help curb public
debt. The backlash against the government reached boiling point in
December 2008, when urban rioting broke out across the country,
led by youths outraged by the police shooting of a 15-year-old boy in
Athens following an alleged exchange between police and a group
of teenagers. Youths hurled stones and fi rebombs at riot police who
responded with tear gas. Concern continues over political tangles in
SINK OR SWIMIn 2009 a lethal cocktail of high public spending and widespread tax evasion, combined
with the credit crunch of global recession, threatened to cripple Greece’s economy. In
2010 Greece’s fellow eurozone countries agreed to a US$145 billion package (half of
Greece’s GDP) to get the country back on its feet, though with strict conditions – the
ruling government, PASOK, still lead by Georgios Papandreou, would have to impose
austere measures of reform to receive these handouts and reduce Greece’s bloated
defi cit. Huge cuts followed, including 10% off public workers’ salaries, but it was too
little too late and foreign creditors continued to demand ever higher interest rates for
their loans. Greece was stuck between a real-life Scylla and Charybdis – to receive
yet another bailout which was absolutely essential to stop them toppling the euro as
a credible currency, they had to eff ect reforms that penalised the average Greek even
further (pushing formerly non-political citizens towards revolution). Some longed for a
return to the drachma (the former currency); however, many believe that Greece would
still be saddled with massive debt and a monetary system with absolutely no standing,
if this was the case.
(At the time this book went to press, Georgios Papandreou asked the people for a
referendum on the EU bailout, then failed to form a coalition government and stepped
down from offi ce. In November 2011, Lucas Papademos – a former vice president of
the European Central Bank – took on the poisoned chalice of steering Greece’s
economy and prime ministerial duties.)ANDERS BLOMQVIST / LONELY PLANET IMAGES ©» Peace & Friendship Stadium, Athens