Nerves are fraying as Europe’s debt crisis escalates
The escalating rhetoric of European and international policymakers may as good a gauge of the seriousness of the European debt crisis as bond yields. World Bank chief Robert Zoellick became the latest senior figure to criticize the indecisiveness of Europe’s leadership. In an interview published today, Zoellick discounted the notion that emerging-market reserve funds will ...
The escalating rhetoric of European and international policymakers may as good a gauge of the seriousness of the European debt crisis as bond yields.
The escalating rhetoric of European and international policymakers may as good a gauge of the seriousness of the European debt crisis as bond yields.
World Bank chief Robert Zoellick became the latest senior figure to criticize the indecisiveness of Europe’s leadership. In an interview published today, Zoellick discounted the notion that emerging-market reserve funds will be able to save Europe. "There’s no silver bullet [for Europe]," he told the Wall Street Journal. "There’s no panacea. Nobody is going to come in with a big bag of money to buy out the problem." Zoellick argues that simply buying time is no longer a viable option for European policymakers. His comments reinforce pressure from U.S. Treasury Secretary Tim Geithner and IMF chief Christine Lagarde, both of whom have argued that European leaders need to take more decisive steps.
For their part, European leaders are bristling at the drumbeat of criticism. In response to Geithner’s intervention, several European finance ministers pointed out acidly that Europe’s economic fundamentals aren’t very different from those of the United States. "I found it peculiar that even though the Americans have significantly worse fundamental data than the euro zone . . . they tell us what we should do," complained Austria’s finance minister.
Meanwhile, key Greek leaders have had just about enough of being kicked around by European policymakers. In a rambling statement issued over the weekend, Greek finance minister Evangelos Venizelos warned that the Greeks cannot tolerate continued "humiliation."
It is very crucial that Greece protects itself against such a tense background. We should not be the scapegoat or the easy excuse that will be used by European and international institutions in order to hide their own lack of competence to manage the crisis and give a definitive and complete answer to the attacks against euro, the world’s strongest currency.
David Bosco is a professor at Indiana University’s Hamilton Lugar School of Global and International Studies. He is the author of The Poseidon Project: The Struggle to Govern the World’s Oceans. Twitter: @multilateralist
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