Athens and Brussels clashed today over whether Greece was doing enough to resolve the debilitating debt and deficit crisis that is imperilling the stability of the euro.
George Papaconstantinou, the Greek finance minister, pleaded for time and argued that the radical austerity programme aimed at slashing 4% from the ballooning budget deficit this year was unprecedented in his country's history.
But Olli Rehn, the European commissioner for economic and monetary affairs, cast doubt on the Greek package, demanding extra action.
"Risks are materialising, and therefore there is a clear case for additional measures," said Rehn of the programme that has already been endorsed by the commission and is supposed to be supported by European finance ministers tomorrow.
"We're embarking on reforms never attempted before," replied Papaconstantinou. "Let's go with common sense."
The spat between Brussels and Athens came as the finance ministers from the 16 countries using the single currency met to finesse their plans for overseeing rigorous implementation of the package, which is aimed at warding off the threat of Greek insolvency and reducing market pressures on the euro.
A European summit last week made tough demands on the Greek government while also offering vague promises of help if needed to avert a sovereign default.
The Greek finance minister dismissed talk of "imminent collapse" as "absurd" and insisted that his centre-left Pasok government had broad public support at home as it tackles the eurozone's worst ever crisis.
"We're trying to change the course of the Titanic," he said. "Anyone else doing this would get applause. But they tell us: 'You're not doing enough. You won't be able to do it anyway.'"
Papaconstantinou "partly" blamed the hedge funds for betting against the euro and Greece, aimed at engineering a "self-fulfilling prophecy". He voiced support for tighter regulation of hedge funds trading in credit default swaps on Greek debt. Part of Greece's problem, he said, was that "pure speculative gains are pushing us towards the edge".
The minister added that the role played by investment banks such as Goldman Sachs and JP Morgan in striking derivatives deals with the Greek government in order to conceal the true state of the public accounts was not unique to Athens. "Greece was not the only country using them [derivatives]," he said.
The EU is to send teams of experts from the European commission, the European Central Bank and the International Monetary Fund to police the Greek austerity programme and rule whether the package will achieve its aims. tonight's meeting in Brussels was dominated by working out how the unprecedented policing regime would work. A conference of the same ministers last Wednesday failed to reach a consensus.
The commission today called for the EU's statistical arm, Eurostat, to be given stiffer auditing powers to scrutinise a member state that is fiscally delinquent. The ECB also announced it had created a beefed up department to deal with financial stability in the euro area.
Jean-Claude Juncker, the Luxembourg prime minister who chairs the Eurogroup, went further than last week's summit by declaring at the weekend that eurozone governments would help Greece to "re-finance" its debt if needed, but declined to specify how this would take place.
While the markets are craving strong and clear signals on support for Greece, EU leaders appear resolved to keep the markets guessing until and if things come to a crunch. "People think we are in a terrible mess," said Papaconstantinou. "We are."
But he bristled at suggestions in Brussels that his austerity package is not radical enough.
The government is imposing real wage cuts of more than 5% on the swollen public sector, making staff cuts, slashing the numbers of municipalities and public entities, raising the retirement age, trying to reform the pension system and revenue collection, and raising taxes on fuel, tobacco and alcohol.