Greece on the edge
GREECE was gripped by extraordinary uncertainty last night as it awaited the outcome of a confidence vote that seemed unlikely to resolve a political crisis that threatens to force it out of the euro.
Greece's Prime Minister George Papandreou, who has lost the confidence of his own party, his European allies and his remaining public support, was still trying to persuade parliament to back him one last time.
In the contorted reality created by a week of upheaval, the irony was that his remaining hopes rested on assurances that if he won support, he would step down straight afterwards. EU leaders have made it clear that agreement on the bailout proposed at last month's eurozone summit cannot wait for Greece to resolve its political crisis through fresh elections.
Another day of feverish political horsetrading in Athens failed to deliver the consensus that EU leaders have demanded in order to go ahead with loans the country needs to avoid a disorderly default and exit from the euro.
The conservative opposition has demanded Mr Papandreou's resignation as a precondition for joining a government of national unity, which would oversee the adoption of the EU's rescue package prior to fresh elections.
A compromise scenario in which a "government of the talents" - drawn from outside active politics - would be appointed to secure Greece's future in the euro with the unpopular legislation demanded by the EU and the IMF, struggled to get off the ground. The rulings socialists pushed last night for the caretaker option but could not agree, even among themselves, who should lead it.
"We need three or four months... to rationalise the situation, restore calm to the country, get rid of that $100bn in debt and build international credibility," pleaded ruling party spokesman Christos Protopappas.
"Then we can get back at each others' throats for a month with elections - at that point everyone will be able to wait for us."
A third option, which has received some support in Greece's intellectual community, envisaged a transitional government of technocrats assuming power for the next two years. Names put forward for this administration have included former Prime Minister Costas Simitis and former vice president of the European Central Bank Lucas Papademos.
None of these scenarios address the deeper crisis in which public support for the country's political system has collapsed with potentially dangerous consequences.
"The biggest problem in Greek politics is the absence of public support," said Christoforos Vernadakis, from opinion polling firm VPRC.
"Everyone is furious with the politicians and the anger has reached violent proportions."
All efforts to find a compromise deal have foundered on the refusal of Greece's beleaguered premier to resign despite an approval rating that has sunk below five per cent. Mr Papandreou told the Greek parliament on Thursday that he "was not glued to his chair" and would not seek re-election, but ruling party sources said he is adamant he will choose the manner and timing of his departure.
France and Germany have made it clear that a rescue package of loans and debt forgiveness remains Greece's only option for remaining in the euro. They have also stipulated the bail-out must be passed into law by at least 180 of Greece's 300 parliamentarians for the next tranche of loans to be released.
These conditions have been accepted by all sides in Greece's fractious political scene, but the formula for agreeing which of them will oversee the process has proved impossible to agree.
The notion of a caretaker government has gained support among the political elite, but it may be less popular on the streets where riots have become an almost weekly occurrence.