UPDATE 2-Greece says will clean up corruption in politics

* Government promises to clean up politics

* Public unrest over perceived uneven impact of cuts

(Adds opinion poll)

By Angeliki Koutantou

ATHENS, May 15 (BestGrowthStock) – Greece’s government said on
Saturday it will clean up corruption among politicians and
restore public trust, but faces flagging support and public
anger at measures to resolve a debt crisis that has hit the
euro.

Greece has been rocked by a series of major street protests
against government measures to cut the country’s deficit and a
key demand of the protesters has been a crackdown on corrupt
politicians they blame for mismanaging the Greek economy.

“What people want, and the government certainly shares that
desire, is for there to be a clean-up both at the political and
social level, so that relations between each other clear up and
confidence is restored,” government spokesman George Petalotis
told a weekly newspaper published on Saturday.

For decades Greeks have tolerated endemic petty corruption
and political graft. But the current debt crisis has forced the
government to introduce an austerity package in return for a
110-billion euro ($140 billion) EU and IMF bailout.

Investors are closely watching public reaction to the wage
cuts and tax hikes, and whether the Socialist government will
stand up to public pressure, or soft pedal on painful reforms.

Some 12,000 Communist Party supporters marched through
central Athens on Saturday waving red flags and chanting slogans
condemning the government.

While much smaller than the 50,000-strong protest in which
three people were killed a week ago, the peaceful march
illustrated the strength of feeling among just one faction of
the many opposed to the government austerity measures.

“We ask for more justice and that the measures do not only
burden wage-earners and pensioners. They should be the same for
all,” said one of the marchers, Elpida Tarantili, 32.

Greek unions have called a 24-hour general strike on May 20.

Support for both the ruling socialists and the opposition
conservatives is falling, while 21 percent of Greeks said they
would spoil their ballot if there were an election now, an
opinion poll in Ethnos newspaper said on Saturday. [nLDE64E0AB]

But Greek Prime Minister George Papandreou’s personal
popularity remains strong at 60 percent, and 51 percent of
Greeks said last week’s EU-IMF bailout had been imperative.

NO OPTION

The depth of anger from a public unwilling to bear the brunt
of the cutbacks while politicians and the wealthy appear to
prosper, means the government simply must act, analysts say.

Some 88 percent of Greeks said the burden of the cuts was
not being not equally shared, the Ethnos poll showed.

“There is such a climate that there is no option for the
government other than moving ahead with fighting tax evasion and
cleaning up politics,” Konstantinos Routzounis, head of Kappa
Research pollster, told Reuters.

For now, parliamentary investigative committees are looking
into two corruption scandals dating from the previous
conservative government; a land-swap deal that cost the state
millions of euros, known as Vatopedi, and a bribes-for-contract
affair involving German firm Siemens (SIEGn.DE: ). The Justice
Ministry also is promising to probe the income of top officials.

“Certainly, there is the necessary political will and
consent that the Siemens and Vatopedi cases that hurt our
country’s political life are cleared out,” Petalotis said.

“But in no case will we fall into the trap of penalising the
country’s political life,” he added. “In no case will we allow
blood to be shed in the name of popularism and petty politics.”

Investing

(Writing by Jon Hemming; Editing by Louise Ireland)

UPDATE 2-Greece says will clean up corruption in politics