Europe's debt crisis threatened to turn into a wider social and political emergency this week as general strikes and protests paralyzed Athens and Madrid, and Greek leaders lashed out at their German rescuers amid dark economic projections.
Protesters in Greece battled police using rocks and bottles last night at the end of the second day-long general strike. The walkout closed schools, hospitals and most forms of transportation, shutting down the economy as the government prepared to freeze pay, increase retail taxes and raise the retirement age to 63 to reduce a huge deficit and attempt to pay off €53-billion ($75-billion) in public debt owed this year.
As European leaders scrambled to find a way to prevent the continent's troubled southern nations from defaulting and jeopardizing the euro, citizens and some political leaders in those countries fought back, badly fracturing Europe's cohesion. Greece's general strike, the second in two weeks, followed a shutdown in debt-crippled Spain on Tuesday, with a countrywide general strike scheduled in Portugal next week.
The European Union still has not produced clear plans for preventing defaults and bailing out the countries known as PIIGS – Portugal, Italy, Ireland, Greece and Spain. Greece is in the most serious danger, but a default there could lead to a domino effect that could bring down other weak economies.
In a shocking gesture that seemed to transform Europe's bailout tensions into an outright political crisis, Greece's deputy prime minister Theodoros Pangalos on Wednesday lashed out at Germany, the only country able to provide the money to rescue the balance sheets of Athens.
In an interview with the BBC, he blamed Greece's debt problems on the 1940s Nazi occupation: “They took away the gold that was in the Bank of Greece, and they never gave it back. This is an issue that has to be faced some time in the future. … They shouldn't complain so much about stealing and not being very specific about economic dealings.”
