Obama Urges European Solution to Debt Crisis
Published: November 3, 2011
CANNES, France — President Obama plunged Thursday into the fast-moving European debt crisis, arriving here to exhort European leaders to get their financial house in order.
But while the president hustledfrom meeting to meeting with world leaders, he was in many ways thrust into the rare position of bystander, as the unfolding drama over whether the Greek government would fall (it did not) and whether Greece would back the comprehensive accord to protect the euro reached last week (it will, at least for now) dominated conversations in the hallways and conference rooms here in this iconic seasidetown.
The grand Espace Riviera is more accustomed to red-carpet arrivals by movie stars and hangers-on for the Cannes Film Festival; on Thursday it was transformed instead into ground zero for blue-suited bureaucrats grappling with a financial crisis and the global contagion that it threatened.
Instead of Angelina Jolie posing before the paparazzi, it was Chancellor Angela Merkel of Germanyholding a frozen smile as she greeted Mr. Obama in front of the cameras. There was little preening before the hundreds of reporters gathered from all over the world; President Nicolas Sarkozy of France quickly swept Mr. Obama into a meeting to discuss how to try to stop the unfolding Greek drama from turning into a tragedy, for global markets at least.
Mr. Obama arrived early Thursday morning and,during an initial meeting with Mr. Sarkozy, he called the European financial crisis the most important task for world leaders gathered at the Group of 20 economic summit meeting.
For Mr. Obama, the stakes are high. He has called the European financial crisis the largest headwind facing the American economic recovery, and he knows that his own re-election prospects are tied to how well the Americaneconomy does. But at the same time, his leverage is limited.
In public, Mr. Obama largely stuck to his administration’s official message that Europe’s leaders must “flesh out details” about the plan they agreed to last week in Brussels to deal with the debt crisis in the 17 European Union countries that use the euro. But American officials, including Treasury Secretary Timothy F. Geithner, werehuddled in private with their European counterparts trying to hash out an agreement that, at the very least, would stop the disintegration under way in Greece from spreading to Italy and Spain, a contagion that could further stymie America’s own anemic economic recovery.
American officials exhorted their European counterparts to use Europe’s own resources to try to solve the crisis, instead ofseeking bailout help from China. Obama administration officials point to the steps that the United States took to try to address its own financial crisis over the past three years.
“Look, we went through this ourselves,” an Obama administration official said on Thursday, speaking on grounds of anonymity because he was not authorized to speak publicly. “They have the capacity to handle this withinEurope.”
Jay Carney, the White House press secretary, said that the 2008 Wall Street crisis could provide insight on steps Europe should take. He maintained that the United States remains influential in advising its allies on how to deal with the problem, even if the United States is in no position to provide financial support.
“The United States, obviously, has a great deal of influence,because of who we are and the role we play in the global economy, and globally in general,” Mr. Carney said in a news briefing on Wednesday. “I would not discount the significance of the experience that we have in terms of its usefulness to the Europeans.”
The Obama administration is not eager to see an increase in the resources sent by the International Monetary Fund to Europe; that might...
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