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Greeks Reject Bailout Terms in Rebuff to European Leaders

Greeks delivered a shocking rebuff to Europe's leaders on Sunday, decisively rejecting a deal offered by the country's creditors in a historic vote that could redefine Greece's place in Europe and shake the Continent's financial stability.

As celebrants gathered in Athens's central Syntagma Square, the Interior Ministry reported that with almost 90 percent of the vote tallied, 61 percent of the voters had said no to a deal that would have imposed greater austerity measures on the beleaguered country.

The no votes carried virtually every district in the country, handing a sweeping victory to Prime Minister Alexis Tsipras, a leftist who came to power in January vowing to reject new austerity measures, which he called an injustice and economically self-defeating. Late last month he walked away from negotiations in frustration at the creditors' demands, called the referendum and urged Greeks to vote no as a way to give him more bargaining power.

While Mr. Tsipras now appears to have his wish, his victory in the referendum settled little, since the creditors' offer is no longer on the table. There remains the possibility that they could walk away, leaving Greece facing default, financial collapse and expulsion from the eurozone and, in the worst case, from the European Union.

At stake, however, may be far more than Greece's place in Europe, as experts have offered wildly differing opinions about what the referendum could mean for the future of the euro and, indeed, the world's financial markets.

Even before the voting was over, some European leaders began making efforts to contain the potential damage. Chancellor Angela Merkel of Germany said she would travel to Paris on Monday to meet with the French president, François Hollande, for a "joint assessment of the situation after the Greek referendum." Later, the two leaders called for a European Union summit meeting on Tuesday, The Associated Press reported.

To some, the vote was virtually a point of no return. Germany's economy minister, Sigmar Gabriel, who is also the leader of the Social Democrats, said it was now hard to see how talks could resume on a bailout deal.

"Tsipras and his government are leading the Greek people on a path of bitter abandonment and hopelessness," he told the daily Tagesspiegel, adding that they have, "torn down the last bridges on which Greece and Europe could have moved towards a compromise."

The vote took place under what some analysts called a financial carpet bombing. The European Central Bank severely limited financial assistance to Greek banks, forcing them to close a week before the referendum, making it hard for retirees to get their money and raising widespread fear here that people would lose their deposits.

The news media, dominated by Greek oligarchs, saturated the airwaves and the newspapers with stories about losing gasoline and medicines, while the plight of elderly pensioners was afforded far more attention than in the past, media experts said.

Nonetheless, many voters, tired of more than five years of soaring unemployment and a collapsing economy, said they could not accept the terms of the European offer, which imposed yet more pension cuts and tax increases, without any hint of debt relief.

As word spread of a likely victory for the no vote, people began gathering in Syntagma Square. They streamed out of the metro -- which is free in this week of capital controls -- and drove by, honking horns. Vendors sold Greek flags, and there was a peaceful, celebratory atmosphere.

People made speeches. Some remembered that at the beginning of the crisis in 2011 Syntagma became a gathering place for protesters. But in those days it was a scary place, they said, in contrast to Sunday night.

While there had been speculation about Mr. Tsipras stepping down in the event of a yes vote, the man he succeeded as prime minister, Antonis Samaras, the leader of the New Democracy Party, announced his resignation, saying "I understand that our great party needs a new start."

For some voters, the week of hardship -- they could withdraw only 60 euros, or about $67, a day from A.T.M.s, and already some pharmacists were refusing to fill prescriptions -- only strengthened their sense that Greece needed to stand up for itself.

After five years in which unemployment soared beyond 20 percent and the country's economy contracted by 25 percent, many said that a no vote was at least a vote for hope, the possibility of a new deal, rather than following the mandates of creditors who had failed to set Greece on a course to recovery.

For others, the hardship only proved that Greece, like it or not, was in the hands of its creditors and could do little but take whatever terms were being offered -- the alternative of default, financial collapse and withdrawal from the euro being unthinkable. In many cases, they blamed Mr. Tsipras's young government for having returned the country to recession when it had shown small signs of recovery just before the January elections.

At a polling place near the archaeological museum in Athens turnout was low, poll workers said. And people coming out of the voting booths seemed split.

"I voted with my heart and also my mind," said Marie Triadafillou, who works in transportation logistics and voted yes. "I believe when you are in a union you cannot leave. We say in our country if the sheep leaves the flock it cannot live."

Yet others felt that the referendum was not about staying in the eurozone but simply part of the long negotiations between Greece and its creditors, which broke off more than a week ago when a frustrated Mr. Tsipras left Brussels and called for the referendum.

Since then, European officials have refused to negotiate further and to extend a deadline for the last bailout program, triggering a decision by the European Central Bank to cap its emergency support to Greek banks. This forced the government to close the banks for fear of extended bank runs.

At a polling station in a middle-class Athens neighborhood, Baizar Tazerian, 76, said she was angered by what she believed had been European interference in the ballot and had just voted to reject the deal in the referendum.

"No, means that we don't have to say yes to whatever they are saying," Ms. Tazerian said.

At a polling station in a southern neighborhood of Athens, Pantiotis Andrikopoulos, 33, a student, said he planned to vote no "because I don't like being blackmailed by the E.U." He did not buy European arguments that a no vote meant Greeks wanted to leave the eurozone. "I'm for Europe but against the memorandum," he said, as he stood in a long line of people waiting to vote.

He also wasn't worried that Greek banks would remain closed in the event of a no vote. "I don't believe that," he said. "They're trying to terrorize people with such talk."

In Ilisia, a middle-class neighborhood, the poet Titos Patrikios, 87, voted at a school that was surrounded by pink and white oleander.

Mr. Patrikios seemed to embody much of his country's modern history. As a teenager during World War II, he took part in the resistance against the German occupation. After the civil war, he was imprisoned for his leftist sympathies. And after the military seized power in 1967, he was forced into exile.

Mr. Patrikios said he was voting yes, but urged everyone to vote their own consciences. "I vote yes because the real dilemma is inside or outside of Europe," Mr. Patrikios said. "In Europe, things are difficult sometimes, they are critical. But outside Europe is the catastrophe. So we have to choose between catastrophe and difficult."

He added that the most important thing was to avoid pitting Greeks against Greeks, but that he was not too worried: "I suffer from one illness and that is incurable optimism."

Athanasis Chryssochoidis, 76, a pensioner and a friend of Mr. Papantoniou's, said Greece was being made an example in case other Southern European nations tried to challenge the dictates of the eurozone.

"Tsipras and all of them want to negotiate," Mr. Chryssochoidis said. "But as soon as they said yes to something, the Europeans put up more demands. The issue is that Syriza is a left party and they don't want such mischief."

"We've reached our limit," Mr. Chryssochoidis said. "This is not a society of beggars."

[Source: By Suzanne Daley, The New York Times, Athens, 05Jul15]

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