Greece dances around words to keep anti-bailout public on side

By Costas Pitas ATHENS (Reuters) - Greece's new leftist-led government walked a semantic tightrope on Thursday to assure supporters it had not climbed down and sacrificed national pride by requesting an extension of euro zone financial support while seeking to satisfy its creditors. Government officials stressed their proposal to extend a loan agreement with the euro zone did not mean reneging on an oft-repeated pledge to scrap a hated bailout programme. Shortly after Finance Minister Yanis Varoufakis submitted a letter in which Greece made concessions in an attempt to secure funding and avoid bankruptcy, officials in Athens insisted they were not performing a U-turn. "The government, true to its commitments, never asked for an extension to the bailout," a government official said, emphasising that the letter spoke of a humanitarian crisis in Greece and efforts to secure debt reduction and growth. "We submitted a proposal that respects the (electoral) verdict of the public, champions the dignity of society and at the same time can be accepted by our partners." Prime Minister Alexis Tsipras, elected on Jan. 25, has made emotional pledges that the bailout and the "troika" of EU, IMF and European Central Bank inspectors overseeing it "died" the day his government took office. However, the letter seen by Reuters showed Greece recognises the existing EU/IMF programme as the legally binding framework for the next six months and accepts supervision by the European Commission, the ECB and the IMF. The document avoided the words "memorandum" or "programme", referring obliquely to the "current arrangement". It mentioned the Commission, ECB and IMF only as "the institutions". The Syriza-affiliated Avgi newspaper highlighted on its website that a key document setting out the bailout conditions, the "memorandum of understanding", was not mentioned in the Greek proposal submitted to the euro zone. "Government circles clarified that the Master Financial Assistance Facility Agreement has nothing to do with the link between the financial agreement and bailout terms," the paper said, referring to the technical name of the loan agreement. Germany's finance ministry rejected the Greek proposal for precisely that reason, setting the stage for tough negotations among finance ministers on Friday in which Athens may be forced to climb down further. NO FIG LEAF The government's efforts to manage its message appear to be working so far, with Greeks proud of what they see as leaders finally standing tall instead of taking orders from Berlin. "With the public, the government has won in terms of resonance, sympathy and credibility. This is not going to change significantly despite the fact that it has rowed back on many of its positions," said Costas Panagopoulos, head of Alco pollsters. "People support the government in its efforts to negotiate something better, and this support is strong, but everything will depend on the result." So far the left wing of Syriza - which contains a range of elements from social democrats to Greens, Marxists and former Communists - has not openly disagreed with the concessions. Ordinary Greeks, who have overhelmingly supported Tsipras' hardline stance at euro zone meetings in the past two weeks despite a looming financial crisis, also appeared to back the government's changing position. "This isn't a U-turn," said Panagiotis Foradis, a 27-year old shop assistant. "This is a good move because the government is laying down its own conditions and opposes the bailout but at the same time does not want to clash with the Eurogroup." The main howls of protest came from opposition figures who argued that despite Tsipras's bravado, he had been humiliated and achieved little in return. Centre-left Pasok leader Evangelos Venizelos, whose party helped implement the bailout, said Tsipras had wasted time for little gain. "After losing precious time in supposedly tough negotiation for internal consumption, the government has ... asked for an extension of the loan agreement that is identical to the memorandum and the bailout programme," he said. Giorgos Kyrtsos, a member of the European Parliament for the conservative New Democracy party, mocked the government for its proposal that was then rejected by Germany. "They got crafty with their spin at the expense of the Germans and Berlin is now asking them for a record adjustment without a fig leaf," he tweeted. (Additional reporting by Renee Maltezou, editing by Deepa Babington and Paul Taylor)