Europe Economy

Anger Turns to Resignation After Greek Crisis Cuts

Reported by Carl Quintanilla, Guy Johnson, Jason Gerwirtz, written by Michelle Lodge

A mood of resignation pervaded the crowd outside the Greek parliament building on Thursday, after lawmakers passed far-reaching three-year budget cuts to deal with the country's  teetering economy.

The atmosphere contrasted dramatically with that of the day before when a violent rally left three dead and a bank set ablaze.

Wednesday's angry protesters were reacting to the impending vote and to general frustration over claims that allegedly corrupt politicians have led the Mediterranean nation to the brink of ruin.

An escalation of violence never materialized on Thursday, even through thousands of people gathered, some bearing signs that bore such sentences as, “Your stolen profits have taken our lives,” and “IMF, get out of Europe.”

Greece Debt Threat

As a precaution, the police and special forces surrounded the parliament building and streets around it were closed to traffic. Occasionally, a frustrated Greek would approach an officer and engage in an angry barrage about the austerity measures and how Greek leaders had let down the country.

On Thursday, the lawmakers approved $30 billion in budget cuts. That means the average Greek citizen is facing new taxes on alcohol and cigarettes, an increase in the value-added tax, freezing pensions and reduced retirement benefits; government workers will see their salaries slashed.

“I’m 40 years old. After my pension is cut, I can work more years,” an accountant outside the parliament building told CNBC Thursday. “But a 70-year-old can’t work longer.”

Away from the parliament neighborhood, tourists continued visiting Athens’ famous historical sites. Taxi drivers were working, but charging exorbitant rates.

A group of Dutch tourists caught in Wednesday’s violence say they could smell the tear gas.

Meanwhile, in Lisbon, European Central Bank head Jean-Claude Trichet emphasized that restructuring, not default, is the answer for Greece. He also tried to play down the “contagion” effect, saying he does not see any similarity between Greek economic woes and those of Portugal.

In the United States, one Congressional representative told CNBC Thursday that she opposes  the IMF's participation in the Greek bailout, because of the cost to U.S. taxpayers. As the top member of the IMF, the United States is contributing 17 percent, or $39 billion, to aid Greece.

“We are being asked to help bail out our economic competitor,” said Representative Cathy McMorris Rodgers, (R-Washington). “It’s not just going to stop with Greece. One of my concerns is the moral hazard that we will not just be helping Greece, but Spain, Portugal and who knows this bill will be in the end.”