web analytics
December 19, 2014 / 27 Kislev, 5775
 
At a Glance
InDepth
Sponsored Post
8000 meals Celebrate Eight Days of Chanukah – With 8,000 Free Meals Daily to Israel’s Poor

Join Meir Panim’s campaign to “light up” Chanukah for families in need.



The U.S. Politics of the Eurocrisis

President Obama on the phone

Photo Credit: “NASA/Bill Ingalls

The eurocrisis has been festering for well over two years. What initially looked like a small problem, involving relatively small peripheral countries such as Greece, Portugal and Ireland, is now dragging the entire European economy into a recession. During his first three and a half years in the White House, Europe was not high on Barack Obama’s priorities. Belatedly, however, Obama seems to have realized that his own reelection next November might be in jeopardy if the eurocrisis leads to worldwide financial instability and global economic depression. Europe is the world’s largest trading bloc. Thousands of American jobs depend on trade with Europe. Obama’s chances of reelection are bound to diminish as soon as Americans start to lose jobs as a result of a eurocrisis spun out of control.

Nicolas Sarkozy, the former President of France, hoped that he would be reelected by the time that the eurocrisis would begin to affect France. He was wrong. France was hit sooner and deeper than Sarkozy expected, and he lost the elections. Similarly, Obama hopes that the eurocrisis will not begin to affect America before November. Play for time is the only thing he can do. And playing for time means the same for Obama as it meant for Sarkozy: He needs to persuade Germany to buy time by bailing out the bankrupt economies in Southern Europe.

During the past weeks, Obama has spent many hours on the phone with European leaders – and in particular with German Chancellor Angela Merkel — to find a way to contain the eurocrisis. At this week’s G-20 summit in Los Cabos, Mexico, more pressure was exerted on Frau Merkel.

Germany, Europe’s economic powerhouse, is the only country in Europe capable of bailing out insolvent countries such as Greece and providing enough financial backing to prop up Spain’s collapsing banks.

The problem is, however, that even if Britain and the United States join in, the European economies along the Mediterranean such as Greece and Spain keep contracting, making it ever more difficult for them to overcome their debt problems. Consequently, they will keep on needing one bailout after another, without the prospect of improvement in the foreseeable future. In 2010, Greece received a first bailout of €110bn. Germany provided the bulk of the money. Earlier this year, Athens received a second bailout of an even more staggering €130bn. Again, Germany provided the bulk of the money. This summer, Greece will need a third bailout. Meanwhile, last week, the eurozone countries decided to give Spain €100bn to bail out its banks. As usual, Germany will have to pay most of the money. But analysts say that another €200bn might be needed to save the Spanish banking sector.

As long as the Germans believe that it is in their interest to save the euro, the common European currency which ties Germany to countries such as Greece and Spain, they are prepared to keep paying the euro’s rising price tag. But the German people are becoming exasperated and angry.

A growing number of Germans are losing faith in the eurozone. Others feel betrayed. Even ten years ago, when the euro was introduced as the common currency of several European countries, a majority of Germans were reluctant to give up the D-mark for the euro. They were reassured, however, by their politicians’ promise that there would be no bailouts. Bailouts between European countries are, in fact, prohibited by the European treaties. Nevertheless, Europe’s politicians have found legal loopholes to impose them anyhow. Reluctantly, national parliaments have consented to the bailouts out of fear that the bankruptcy of one eurozone country would drag the entire monetary union down.

A poll last week suggested that 69% of the Germans want Greece to leave the euro and return to the drachma, and 29% of the Germans want Germany to leave the euro and return to the D-mark. Either event – a Greek exit or a German exit – is expected to have enormous repercussions and dramatic consequences, not just for Europe but for the entire global economy. The cost would be enormous, but some Germans reckon that ultimately the price tag for Germany might be less than the price of continuing with the present policies of seemingly endless bailouts.

To secure his own reelection, Obama has to persuade Merkel to keep footing the euro bill at least until his own reelection is assured in November. Obama is fortunate that Merkel is a staunch believer in European integration and seems prepared to continue the present policies, even in disregard of her own rising unpopularity among the German electorate.

Last Thursday, however, Merkel warned that Germany is not strong enough to prop up the rest of Europe. “Germany’s strength is not infinite. Its powers are not unlimited,” she said in a speech delivered in the Bundestag, the German Parliament, but meant for her colleagues of the G-20 and especially for Barack Obama. Merkel wants the G-20 to help the Germans prop up the collapsing economies of the European periphery. “It is a herculean task, but it is unavoidable,” she said, but hinted that Germany cannot continue to do it on its own.

Consequently, if Obama and other world leaders want Merkel to keep propping up the euro with German taxpayers’ money, they will have to share some of the burden. Soon, the world will have to come to the rescue of Europe, and help to bail out the eurozone. Merkel knows that Obama needs reelection in November and that, if she wants to be successful in her effort to persuade America to assist her in her euro rescue effort, she needs to do it now. Until November, the euro’s problems are Obama’s problems, too.

Originally published by Gatestone Institute http://www.gatestoneinstitute.org

About the Author: Peter Martino is a European affairs columnist for the Gatestone Institute.


If you don't see your comment after publishing it, refresh the page.

Our comments section is intended for meaningful responses and debates in a civilized manner. We ask that you respect the fact that we are a religious Jewish website and avoid inappropriate language at all cost.

If you promote any foreign religions, gods or messiahs, lies about Israel, anti-Semitism, or advocate violence (except against terrorists), your permission to comment may be revoked.

No Responses to “The U.S. Politics of the Eurocrisis”

Comments are closed.

SocialTwist Tell-a-Friend

Current Top Story
Cinema City Iron Man Theater in Jerusalem. (illustrative)
US Govt IDs North Korea in Sony Cyber Terror Attack
Latest Indepth Stories
Greiff-112814-Men

Am Yisrael is one family, filled with excruciating pain&sorrow for losing the 4 kedoshim of Har Nof

Two dreidels from the author’s extensive collection.

What is its message of the dreidel?” The complexity and hidden nature of history and miracles.

Keeping-Jerusalem

Police play down Arab terrorism as mere “violence” until the truth can no longer be hidden.

Sprecher-121914

The 7 branches of the menorah represent the 7 pillars of secular wisdom, knowledge, and science.

Obama obtained NO verifiable commitments from Cuba it would desist from acts prejudicial to the US

No one would deny that the program subjected detainees to less than pleasant treatment, but the salient point is, for what purpose?

For the past six years President Obama has consistently deplored all Palestinian efforts to end-run negotiations in search of a UN-imposed agreement on Israel.

It’s not an admiration. It is simply a kind of journalist fascination. It stands out, it’s different from more traditional Orthodoxy.

For Am Yisrael, the sun’s movements are subservient to the purpose of our existence.

Israelis now know Arab terrorism isn’t caused by Israeli occupation but by ending Israeli occupation

Anti-Semitism is a social toxin that destroys the things that people most cherish and enjoy.

Amb. Cooper highlighted the impact of the Chanukah/Maccabee spirit on America’s Founding Fathers

Zealousness has its place and time in Judaism; Thank G-d for heroic actions of the Maccabees!

Israel and the strengthening of the Jewish people in faith and numbers has brought a growing light

More Articles from Peter Martino
The Anne Frank Museum in Amsterdam, pictured above, is run by the Anne Frank Foundation, which wrote in a report, "Israel pushes Palestinians economically into a corner and humiliates them psychologically."

“It appears that the suffering of the Jews has not transformed their view on how others should be treated.” — David Ward, British MP.

angela and friend

Because of the “5% hurdle,” Germany’s new coalition will tilt be to the left, while voters clearly wanted Germany to turn to the right.

Belgian children aged 6 to 12 are being instilled with a deep hatred for.

Islamic immigrants are hoping that by turning out a large number of their voters at a time of German voter apathy, they will be able to promote the further Islamification of Germany.

Europeans are rebelling against the unelected E.U. and its grandiose, self-regarding project of abolishing the national sovereignty.

The valuable Cypriot gas fields are located halfway between the Cypriot and Israeli coast.

Indicative of the national mood, the French are the world’s largest consumers of anti-depressants.

What we are witnessing is the Obama administration actively interfering in European politics to advance European centralization.

Printed from: http://www.jewishpress.com/indepth/analysis/the-u-s-politics-of-the-eurocrisis/2012/06/19/

Scan this QR code to visit this page online: