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Greek leftist leader lays out radical agenda

By the CNN Wire Staff
May 8, 2012 -- Updated 1853 GMT (0253 HKT)
STORY HIGHLIGHTS
  • NEW: The leader of the socialist PASOK party says it won't support Syriza
  • New Democracy's leader warns the Syriza bloc could take Greece out of the eurozone
  • Syriza leader Alexis Tsipras is trying to form a government after elections that punished politicians
  • Greece should stand by the bailout terms, a European Commission spokeswoman says

Athens, Greece (CNN) -- Greek leftist leader Alexis Tsipras on Tuesday laid out the radical agenda he hopes to pursue if he becomes prime minister, including the cancellation of severe budget-cutting measures forced on the country by international lenders.

Laws that cut pensions and salaries and those that "cancel basic workers' rights" must be annulled, Tsipras said as he started efforts to form a governing coalition in the wake of Sunday's parliamentary elections.

He also called for state control of the banks, which "remain in the hands of the managers who bankrupted the system," he said.

The Greek people voted clearly to reject the austerity demanded by international lenders, said Tsipras, leader of the Syriza Party.

The two parties that made the agreement with international lenders "don't have a majority any more to vote for the plundering of the Greek people," Tsipras told lawmakers.

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He said he was planning to meet the leaders of those parties Wednesday but called on Evangelos Venizelos of PASOK and Antonis Samaras of New Democracy to renounce publicly the deal they made with international lenders before then.

Samaras said what Tsipras was proposing would result in Greece exiting the eurozone, and that the Syriza leader was doing everything possible to ensure no government would be formed.

Venizelos said PASOK would not form a coalition with Syriza, as the party would only participate in a coalition government that would secure Greece's position in the eurozone.

Greek media reported that Tsipras was preparing to send a letter to the European Union, but it was not immediately known what he planned to say.

Tsipras met Greek President Karolos Papoulias earlier Tuesday to get instructions to try to cobble together a government in the wake of elections that left the country's political system in chaos.

Syriza will have three days to form a government.

Communist Party leader Aleka Papariga spoke with Tsipras by phone but will not meet him, Syriza said.

Fotis Kouvelis of the Democratic Left, which splintered from Syriza in 2010, told Tsipras that when they met Tuesday Syriza needed the support of more than just the left, Tsipras' bloc said.

The Ecologist Greens also rejected Syriza's approach for support Tuesday, saying a road map to exit the crisis was needed.

Syriza came in second in the elections, in which seven parties got seats in parliament and no party captured more than 19% of the vote.

The Greek stock market dropped about 5% in early trading before recovering somewhat Tuesday. The market had fallen more than 6% Monday.

The Greek elections came the same day that French voters kicked out President Nicolas Sarkozy in favor of Socialist François Hollande, who spoke out against austerity in his victory speech Sunday.

The failure of Greece's main center-right party to form a coalition government Monday added yet more uncertainty to the debt-ridden country's political situation.

New Democracy leader Samaras said he did "everything possible" to form a coalition, but none of the parties agreed to join with his party, which won first crack at forming a government after finishing first in Sunday's parliamentary elections.

Politicians have until May 17 to come up with a new working alliance or, if they cannot, set a date for another round of elections.

Syriza more than tripled its parliamentary representation to 51 seats out of 300 in the balloting.

Tsipras left little doubt Sunday about what direction his party would take in a new government.

"European leadership and especially (German Chancellor Angela) Merkel have to understand that austerity policies have suffered defeat," Tsipras said.

He called the election results "a message of a peaceful revolution."

The election results were widely seen as a message to politicians to back away from the harsh economic austerity measures imposed in Greece.

A European Commission spokeswoman said Monday that Greece needs time to work through its political process but reminded the country's leaders that they would be expected to abide by terms of a bailout program meant to avoid a crippling financial meltdown.

"The commission hopes and expects that the future government of Greece will respect the engagements that Greece has entered into," spokeswoman Pia Ahrenkilde Hansen told reporters.

New Democracy finished first in Sunday's voting but ended up with only 108 seats in Greece's 300-seat parliament.

Voters also delivered a rebuke to PASOK -- New Democracy's socialist partner in the outgoing coalition government -- stripping the party of 119 seats.

Together, the parties fell short of the 50% necessary to continue the coalition, requiring formation of a new government.

Last year, Greece's debt threatened to force it to drop Europe's common currency, the euro, prompting the European Central Bank and other lenders to swoop in with emergency funding. In exchange, they demanded that the government slash spending.

The resulting measures have led to tax increases and cuts in jobs, wages, pensions and benefits -- and significant public outcry.

The national unemployment rate for January, the latest month for which figures are available, was nearly 22%, prompting widespread protests and leading some young people to leave the country in search of work.

Youth unemployment is even higher than the national average of one in five out of work.

For two years, the country's massive amount of debt has threatened the stability of the 17-country eurozone.

Greece pushed through a huge debt swap in March to save it from disorderly default and clear the way for it to receive a second bailout from the European Union, the European Central Bank and the International Monetary Fund, worth €130 billion ($171.5 billion).

The debt restructuring deal gave some breathing space to the eurozone bloc, where fears that Greece might collapse had increased pressure on other debt-laden nations such as Spain and Italy.

The tribulations of New Democracy and PASOK were matched by triumphs of a number of other parties that were also-rans and in some cases nonexistent just a few years ago, propelled by voters angry about stringent austerity measures.

CNN's Antonia Mortensen and Matthew Chance contributed to this report.

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