GREEK RIOTS - WHAT HAPPENED AND HOW THEY IMPACT

S E C R E T SECTION 01 OF 04 ATHENS 001692

SIPDIS

E.O. 12958: DECL: 12/17/2018
TAGS: PREL SOCI ASEC PHUM ECON TU MK GR
SUBJECT: GREEK RIOTS - WHAT HAPPENED AND HOW THEY IMPACT
U.S. INTERESTS

Classified By: Ambassador Daniel V. Speckhard for 1.4 (b) and (d)

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SUMMARY
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1. (C) The riots that began in Greece following the December
6 police shooting of a teenager have shocked even the most
cynical of Greeks, and have resulted in hundreds of millions
of Euros in economic damage. The unrest has deeply polarized
society, with youth of all socio-economic backgrounds
generally supporting the demonstrations, and most people over
thirty condemning the violence. Although it is difficult to
pinpoint the exact causes of the riots, major contributing
factors included:
-- the insular, hothouse atmosphere of Greece's few hundred
ultra-radical "anarchists;"
-- popular frustration with corruption and political leaders;
-- the disillusionment of the youth, who see fewer economic
opportunities than previous generations did;
-- irresponsible and inflammatory media coverage branding the
shooting as cold-blooded murder;
-- demoralized Greek security forces, weakened by post-junta
limits and public distrust; and
-- popular sympathy (and in some cases nostalgia) for the
radical left and public tolerance of expressions of
opposition through violent means.


2. (C) The government response was characterized by PM
Karamanlis' absence, and most government announcements were
left to Minister of Interior Pavlopoulos. The government
apparently instructed the police to respond solely with a
defensive posture. We believe the Prime Minister wanted to
avoid any additional deaths or any platform for grievances
and negotiations with the authorities (such as an occupied
government building). Many Greeks believe the Karamanlis
government mishandled the situation -- both by not taking a
tougher stance against the violence but also by having
allowed socioeconomic conditions to deteriorate. Thus, most
Greeks, including those who would normally be Karamanlis
supporters, now believe it is only a matter of time before
the PM has to call new elections, although Karamanlis appears
resolutely opposed to doing so. We expect the opposition to
continue to press hard to bring down the government, and we
expect the government to take steps to show leadership and
action, including likely Cabinet changes.


3. (S) U.S. interests will be affected. Constrained by the
unrest, the Greek government will be even more
inwardly-focused than usual. Greece will likely be unwilling
or unable to take bold actions on regional foreign policy
issues, including the Macedonia name issue, relations with
Turkey, or pressing the Greek Cypriots on negotiations in
Cyprus. The government bureaucracy, ever cautious, will
become even more wary in the face of political uncertainty,
making it harder to address other issues on our agenda,
including commercial, educational, security, and human rights
issues. Finally, there are precedents in Greece for domestic
terrorist groups to strike in the wake of major civil unrest,
taking advantage of exhausted and demoralized security
forces. We will need to continue to monitor aggressively a
potentially growing domestic terrorist threat. End Summary.

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What Caused It?
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4. (C) Although Greece is no stranger to demonstrations that
include destruction of property, Molotov cocktails, and
rioting, the riots that began on December 6 were
qualitatively different. Estimates are still pending, but
the total bill is expected to amount to hundreds of millions
of Euros in damage. The rioting and demonstrations were not
limited to Athens and Thessaloniki but took place throughout
the country, including in normally quiet provincial centers.
Also, although the violent demonstrations were initially the
work of anarchists, thousands of university and high school
students of both sexes eventually joined in. Televised
footage showed youths as young as 13 throwing rocks at police.


5. (C) Reports by major foreign news organizations
highlighted problems in the Greek economy as a cause of the
rioting, and these problems certainly played a role. Like
other smaller European economies, Greece is being affected by
the global downturn. Its two leading industries -) shipping
and tourism -) already are feeling the impact of the credit

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contraction and weakening consumer demand. GDP growth,
relatively strong in recent years (4 percent in 2007),has
slowed in 2008 (the government projection is for 3.2
percent),and is expected to decelerate further in 2009 (the
government projection is for 2.7 percent, but private
analysts, including the IMF, project a lower 2.0 percent
growth rate). Unemployment, especially amongst the young, is
rising, and about a fifth of the population now lives below
the official poverty line. Unemployment numbers are likely
to spike as the economic slowdown hits Greece's real economy
in the new year. But even before the current global
downturn, the Greek economy suffered from structural problems
including a rigid labor market and a large public share of
the economy that limited its flexibility, discouraged
innovation, and stymied expansion. Greece, indeed, has many
of the elements of a corporatist system, in which a
relatively small group of well-known families control
economic and political centers of power. Corruption and
connections, rather than entrepreneurship and innovation, are
seen as the keys to getting ahead. Greece is considered an
unattractive place to work and invest, ranking 96th -) the
lowest in the EU -) in the World Bank's "doing business"
ranking.


6. (C) The Karamanlis government came to power in 2004 with
a reformist agenda, but has met with resistance from
entrenched interests and members of the public -- all for
reform as long as it does not reduce their own individual
perks. Moreover, the Karamanlis government has been plagued
by its own corruption scandals, including the current
Vatopedion monastery affair, which brought down some of the
Prime Minister's closest advisors.


7. (C) Problems in the economy and governance have led to
widespread social dissatisfaction and a sense that economic
opportunities, for the first time in a generation, are
contracting. These frustrations contributed to the recent
rioting and fostered an attitude of tolerance amongst much of
the general public for the youthful "victims" of a government
and society unresponsive to their needs. At the same time,
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"asylum" policies prohibit state security forces from
entering campuses without permission from university
administrators (granted very rarely),adding to the
ideologically charged atmosphere of "anything goes."


9. (C) The anarchists, headquartered at the Athens
Polytechnic, have escalated their violence in recent years.
Many observers believe that this trend was a concerted
attempt to provoke the police into a disproportionate
response, in turn sparking an even broader "uprising." The
anarchists appeared to get what they wanted in the December 6

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shooting of Grigoropoulos, and they used blogs and SMSes to
spread the news and mobilize their forces. As anarchist
violence escalated, other university and eventually high
school and even middle school students, some disgruntled,
others attracted by the radical chic, joined in.

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Dinosaurs of the Hard Left
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10. (C) Exacerbating the unrest was the opportunism of the
leftist political parties. Unlike their counterparts in many
other European countries, the leftist parties of Greece have
not evolved with the fall of the Berlin Wall, further EU
integration, and economic globalization. The ideology,
tactics, and goals of the Greek "hard left" remain much as
they were during the Cold War, and these parties have served
as a retiring ground for many aging anarchists. Reflecting
the ideological divisions of an earlier era, the left remains
divided between the orthodox Marxist-Leninist, Soviet-style
Communist Party of Greece (KKE) and the new left SYRIZA
party, which has taken up the slogans and mindset of
anti-globalization while retaining a loyalty to Marxism.
Both the KKE and SYRIZA supported the recent demonstrations
in an effort to further discredit the government. While the
KKE publicly supported only peaceful, disciplined
demonstrations, however, SYRIZA more openly egged anarchists
and students on to violent action.

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Irresponsible Press
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11. (C) Finally, the Greek press had a role in aggravating
the riots. Most Greek media carried breathless reports
seemingly aimed at inflaming and not calming the situation.
Media hyperbole helped trample the principle of "innocent
until proven guilty" in the court of public opinion, with
many journalists reporting that the accused police officer
had fired on Grigoropoulos in cold blood, although government
officials made similar statements. Police explanations that
the shooting may have been accidental were derisively
dismissed.

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What Did the Government Do About It?
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12. (C) One of the most striking aspects of the events was
the Prime Minister's absence; Karamanlis stayed largely out
of the public eye, leaving public statements to his Minister
of Interior, Prokopis Pavlopoulos. At the height of the
violence, Karamanlis made just two short television
appearances -- calling for calm in the one and laying out a
technocratic, detailed plan for government assistance to
affected businesses in the other.


13. (C) The police generally did not respond assertively to
the violence and instead assumed a defensive posture. We
assess that there are two explanations:

-- Initial Indecision: Initially taken by surprise, the
government took the populist road, not wanting to be seen as
"fascists," and thus did not direct the police to clamp down.

-- Avoid Any Additional Deaths and Deny Anarchists a
Platform: As the riots worsened, however, we assess that
Karamanlis and his advisors calculated that he must first and
foremost avoid the possibility of any additional deaths that
could fuel greater unrest. At the same time, greater force
was apparently authorized to allow police to ensure that the
protestors did not occupy government buildings or significant
landmarks that could be used as a basis for a prolonged
public platform for grievances and negotiations with the
authorities. The police were clearly operating under
different rules of engagement when defending the Parliament
or the Foreign Ministry, than the commercial establishments
next door.

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What Does It Mean?
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14. (C) Weaker Government: While the long-term implications
for Karamanlis are unclear, for now many Greeks believe the
PM and his government severely mishandled the situation.

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Most, including those who would normally be Karamanlis
supporters, are openly stating that it is only a matter of
time before the PM has to call new elections. Conventional
wisdom holds that these events are a final "mortal blow" that
comes on the heels of other political crises, scandals, and
the global economic crisis. The opposition, criticizing the
government's response, called for the government to step
down, and we expect these calls to grow louder, particularly
if the unrest continues. The opposition is smelling blood.
That said, it is impossible to predict exactly when this shoe
might drop. If/when the government does fall will depend
less on the opposition and more on dissent within the
government's own ranks. We expect the government to take
steps to show leadership and action, including likely Cabinet
changes.


15. (C) Our Interests: In short, the Karamanlis government
will be even more inward-looking than before, and it will be
either unwilling or unable to take bold actions or be out of
sync with popular sentiments on key regional foreign policy
issues. This means that the Greek government will likely
take defensive positions on the Macedonia name issue and
relations with Turkey. It will also likely eschew any troop
deployments that could open it up to criticism -- such as
sending significantly increased numbers to Afghanistan.
Greek politicians will also be unwilling to be out of sync
with the Greek Cypriot leadership, and therefore loathe to
press them on any aspect of the current negotiations. The
ever-cautious Greek bureaucracy will, in the face of
political uncertainty, become even more risk adverse, making
it harder to address other issues on our agenda, such as
commercial, educational, security, and human rights issues.
Finally, should rumors of a cabinet reshuffle or early
elections grow stronger, FM Bakoyannis may be seen by her
interlocutors as a potential "lame duck" as she takes on the
role of OSCE Chairman-in-Office in January.


16. (S) Terrorism: Most importantly, we will need to
monitor aggressively the growing domestic terrorist threat.
Following the public outrage that resulted from the 1985
killing of a youth by police, the November 17 terrorist group
entered a renewed operational phase and carried out
additional attacks against Greek, U.S., and other targets.
We will need to sharpen our vigilance to defend ourselves and
to encourage a robust Greek response to terrorism in the face
of exhausted and demoralized security services, popular
dissatisfaction and angst, and a government that will
undoubtedly have its attention focused elsewhere.
SPECKHARD