Party leaders, deadlocked since a parliamentary vote nine days ago, convened at the presidential palace at 2 p.m. (1100 GMT) but had already said they had little hope President Karolos Papoulias's offer would resolve a political crisis that has fuelled speculation Greece's days in the euro zone are numbered.
The political landscape has been in disarray since an inconclusive election on May 6. This divided parliament between supporters and opponents of EU/IMF bailouts which staved off bankruptcy but piled up wage cuts and tax increases on Greeks, deepening the country's recession.
If supporters and opponents of the bailout cannot agree a government, Papoulias will call a new election in June, when Athens must agree over 11 billion euros in extra austerity cuts to stick to targets in the bailout plan.
Jean-Claude Juncker, who chairs the Eurogroup of euro zone finance ministers, dismissed on Monday the prospect of a Greek euro exit as “propaganda.” Juncker seemed to open the door to some softening of the austerity plan, saying a new government could potentially raise the question of extending deadlines, as long as it was still firmly committed to its targets.
But many senior European politicians and European Central Bank policymakers now openly speak about the scenario of a euro exit -- until recently a taboo subject -- and warn that their patience with the Greek political drama is wearing thin.
Dutch Finance Minister Jan Kees de Jager said his government had studied the scenario of a Greek departure from the euro zone although Europe's policy was to keep the country in the bloc.
Greek newspapers also expressed impatience with the political deadlock. “ We are running out of time to form a government of national salvation which would ensure that the country stays in the euro zone and would try to gradually pull it out of the crisis,” conservative daily Eleftheros Typos said.
The bailout's main opponents - the radical leftist SYRIZA party which now leads opinion polls - said they saw the president's plan for a government of non-partisan experts as nothing but a scheme to impose the austerity demanded by the European Union and IMF but already rejected by voters.
Meanwhile, the Greek government on Tuesday strongly criticized the leader of an extreme right party who claimed that Nazi concentration camps did not use ovens and gas chambers to kill prisoners during the Holocaust.
Government spokesman Pantelis Kapsis described televised remarks made by Golden Dawn party leader Nikos Michaloliakos as an “extreme insult to the memory of millions of Holocaust victims.” The spokesman accused the 55-year-old party leader of “distorting history.”
“There were no ovens -- it's a lie. I believe it's a lie. There were no gas chambers either,” Michaloliakos said in an interview with Greece's private Mega television, broadcast on Sunday. Michaloliakos and 20 other Golden Dawn candidates were elected to Parliament in May 6 general elections that saw traditionally dominant parties hammered in the crisis-hit country.
Kapsis described the remarks as an attempt to revise history. ”I condemn these views in the strongest terms,” he said.