Greek leftists vow to scrap 'deadly medicine' bailout

Greece's radical leftist party Syriza laid out Friday a manifesto likely to leave the country's eurozone future hanging by a thread if it wins elections later this month. A bailout deal with the EU and IMF in return for painful austerity cuts "is an automatic pilot to utter disaster," Syriza leader Alexis Tsipras said, vowing if elected to scrap the accord and to freeze repayments on Greece's debt mountain. "We ask for the vote of the Greek people in order to annul it" so that it can be renegotiated, the 37-year-old told a packed auditorium in a run-down Athens neighbourhood. Supporters interrupted him, chanting: "The time of the Left has come." Syriza surprised Europe on May 6 by placing second in an inconclusive election that saw voters fed up with salary and pension cuts shift their loyalties to radical parties. A series of opinion polls published Friday showed that neither Syriza nor its top rival, the conservative New Democracy party, would win an outright majority in new elections called for June 17 after the deadlock. The vote will determine whether Greece will meet the terms of a deal under which the European Union and International Monetary Fund agreed to lend it hundreds of billions of euros (dollars) in return for economic reforms. Tsipras promised to boost the minimum wage, hike taxes on the rich and freeze a major privatisation drive designed to raise 19.5 billion euros ($24.2 billion), a key condition of its bailout deal. He also pledged to "nationalise and socialise" Greek banks that draw on European support funds to recapitalise themselves after a landmark state debt cut brokered by the previous government in March. This would evidently include Greece's top four lenders, which received 18 billion euros from the European Financial Stability Fund (EFSF) this week. Tsipras's stance has raised speculation that Athens could be forced to leave the eurozone if the reforms falter, raising fears for the future of the single currency. "Today we heard how Syriza will lead the country out of Europe and the euro," scoffed a spokesman for New Democracy. The leader of the Socialist Pasok party Evangelos Venizelos, a possible New Democracy ally for a pro-bailout coalition, added that Syriza's proposals would "isolate" Greece in Europe. Tsipras insists Greece can still stay in the eurozone and draw on European support funds, while arguing Friday that the bailout deal itself "is tantamount to returning to the drachma" because of its effects on the economy. He likened the loan agreement to a "deadly medicine" which has caused a "tragedy" in Greece, where more than a million people are jobless and suicides are mounting in an economy now in its fifth year of recession. "You don't save a patient's life by changing the dosage of a deadly medicine. You need to change the medicine itself," Tsipras said. He said his government would also "seek a new renegotiation of the debt at European level, aiming to drastically reduce it, or a debt moratorium and a suspension of interest payments until conditions for the stabilisation and recovery of the economy are created." The Athens stock market fell by 2.7 percent during his speech, and the index later closed with a 4.48-percent rout, tracking drops in shares worldwide on the back of weak US jobs data. The bourse this week has been at its lowest level in 23 years, a stock market official said. On foreign policy, the leftists plan a withdrawal from NATO operations, starting with Greece's mission to Afghanistan, and a future "disengagement" from the alliance altogether. They also want to pursue closer relations with Russia and Latin America and an arms moratorium with historic arch rival Turkey. But they climbed down from an earlier pledge to shut down NATO bases in Greece. Three surveys for Greek media by pollsters RASS, KAPA and ALCO placed New Democracy just ahead of Syriza, which the polls also showed had gained the most support in the past week. The lead fell within the margin of error, effectively tying the two parties level and leaving the outcome uncertain as Greece awaits the next instalment of international loans to keep paying public salaries. A fourth poll, by Public Issue, gave Syriza a lead of six points over the conservatives, with 31.5 percent of the vote. Overall in the four polls New Democracy's share of the vote ranged from 25.5 to 26.5 percent, and Syriza's from 23.5 to 31.5 percent. These scores would oblige the winner to form a coalition with other parties to obtain a parliamentary majority. On May 6 New Democracy came first and the former ruling Socialist party Pasok was third. New Democracy has defended the bailout plan but proposed to temper austerity measures with strategies to boost economic growth. Friday's opinion polls, the last allowed before the election, showed Pasok, which launched the austerity measures when it was in power in 2009, at a distant third place with between 9.9 and 13.5 percent.