TOPICS > Economy

News Wrap: Greece Faces Moment of Truth After Week of High Drama

November 4, 2011 at 12:00 AM EDT

HARI SREENIVASAN: The government of Greece faced its moment of truth tonight after a week of high drama. Parliament proceeded with a confidence vote on Prime Minister George Papandreou. Members of Papandreou’s own Socialist Party revolted after he called for a referendum on a new European bailout. The plan outraged European leaders, and, yesterday, Papandreou backed down.

The Greek leader told lawmakers tonight that he would agree to form a national unity government that includes the opposition.

While the world watched the turmoil in Greece, the G20 economic summit ended in France with no agreement. The world’s leading economies balked at giving financial help to contain the European debt crisis.

We have a report from Laura Kuenssberg of Independent Television News in Cannes.

DAVID CAMERON, British prime minister: I’m not going to pretend that all of the problems in the Eurozone have been fixed.

PRESIDENT BARACK OBAMA: Make no mistake, there is more hard work ahead.

LAURA KUENSSBERG: The French host almost admitting they didn’t get that far. They themselves had set this as the deadline to stop Europe being dragged down by debt. But the U.K., U.S. and China believed Germany’s Mrs. Merkel and other eurozone leaders have to put more of their cash on the line.

She wasn’t to be persuaded. “Why?” ITV News asked a frustrated David Cameron.

DAVID CAMERON: Well, you will have to ask the Germans. But the point is, in the end — and it says this very clearly in the communique from today — that the institutions of the eurozone have to take all the action necessary to safeguard their currency.

LAURA KUENSSBERG: Angela Merkel left the meeting early after a clash over a bigger role in the bailout for the International Monetary Fund. She admitted hardly any other countries have signed up to help.

But the normal rush to see the details of the final deal disappointed.

World leaders have been locked in here for nearly two days, trying to agree how to confront the problems of the world outside. But there is hardly a deal, no final agreement on if and how the International Monetary Fund will help Europe and no final agreements on exactly how the bailout fund will work. But there is, perhaps, a chance tonight that the chaos in Greece is less likely to spread.

Italy’s leader, Silvio Berlusconi, has embarrassingly had to accept that inspectors from other countries will check up on whether he’s really dealing with his country’s huge debts. He turned down an offer of credit last night, denying the country’s in crisis.

But this summit hasn’t ended with much of a fanfare, and for those who had hoped it would bring an end to the crisis, it’s rained on their parade.

HARI SREENIVASAN: Despite the doubts, President Obama said after the summit that he believes Europe will act to prevent the crisis from spiraling out of control.

BARACK OBAMA: I think there are going to be some ups and downs along the way. But I am confident that the key players in Europe, the European political leadership, understands how much of a stake they have in making sure that this crisis is resolved, that the eurozone remains intact. And I think that they are going to do what’s necessary in order to make that happen.

HARI SREENIVASAN: As the news from Cannes and Athens unfolded, Wall Street played it cautious. The Dow Jones industrial average lost 61 points to close at 11,983. The Nasdaq fell more than 11 points to close at 2,686. For the week, both the Dow and the Nasdaq were down 2 percent.

Jon Corzine resigned today as chairman and CEO of the embattled brokerage firm MF Global. The company declared bankruptcy last week. It is now under investigation by federal regulators and the FBI after $600 million disappeared from customer accounts. Corzine has reportedly hired a criminal defense attorney as well. He is a former senator and governor of New Jersey and the one-time head of investment firm Goldman Sachs.

In Syria, thousands of protesters braved military gunfire after Friday prayers, and activists reported at least 19 were killed. It came just two days after the Arab League brokered a deal to end the bloodshed.

Bill Neely of Independent Television News is in Damascus, where he filed this report.

BILL NEELY: Weapons Syria’s army says it seized from militants. Now Syria is offering an amnesty to all those who give up their guns.

But peaceful protest has been at the heart of Syria’s uprising, and near Homs, the hotbed of trouble, we have seen no sign that the army is withdrawing the tanks and troops it’s used to crack down. It says it will do this gradually over the next two weeks.

I met one of President Assad’s ministers. The regime says 4,000 riot police, armed only with sticks, will replace the troops, and it will stick to the deal it’s agreed to.

ABDULFATTAH AMMURA, Syrian deputy foreign minister: Syria means what it says and says what it means and honors its agreements. And we are keen on implementing it by all its parts.

BILL NEELY: To the letter?

ABDULFATTAH AMMURA: I — to the letter.

BILL NEELY: Protesters don’t trust the regime. They were out in Dara’a, where the uprising began, a demonstration dispersed with tear gas.

In Homs, the last few days have been deadly. The gunfire has rarely stopped, according to residents of one suburb. They accuse troops of using anti-aircraft guns on blocks of flats. More than 100 people are reported dead.

There is no sign here in the Damascus that the opposition’s call for mass rallies to test the regime has been heeded. But the regime does now face perhaps its biggest test: sticking to its word, withdrawing troops, releasing prisoners, beginning real reforms. Failure to do that, and it faces protests from across the Arab world.

Not all guns will come off the streets, but the world will be watching Syria and its army to ensure it keeps its word.

HARI SREENIVASAN: The United Nations estimates more than 3,000 Syrians have been killed by government forces since the uprising began in March.

The latest attempt to run the Israeli blockade of Gaza has failed. The Israeli navy intercepted two protest boats today carrying 27 pro-Palestinian activists. They were boarded after they ignored repeated orders to turn around and sail away. The boats were towed to an Israeli port, and the military said no one was hurt. Last year, nine Turkish activists were killed when Israeli commandos intercepted their flotilla.

The U.S. today urged China to relax its tight controls over Tibet. The appeal came after a young Tibetan activist set himself on fire outside the Chinese Embassy in New Delhi, India. So far this year, 11 Tibetans, many of them Buddhist monks and nuns, have set themselves on fire inside China. At least six died.

Six researchers in Russia have completed a 17-month experiment to simulate a manned flight to Mars. The team emerged today from small windowless compartments after 520 days in isolation. The $15 million experiment was designed to test whether people could stay physically and mentally fit on a round-trip to the red planet. The crew included three Russians, plus members from France, Italy and China.

Those are some of the day’s major stories.