When the news broke today that President Barack Obama was pushing the European Union (EU) leaders to hasten their actions to address the euro-zone debt crisis you could almost hear the European snickers all the way over here. Who are we to chastise the EU for their debt crisis when we’ve been spending money like a drunken sailor for decades with the Obama spending-spree of 2009 and 2010 the icing on the cake?
Today the president hosted a summit with European Council President Herman Van Rompuy, European Commission President José Manuel Barroso and foreign-affairs chief Catherine Ashton. In a bit of theater-of-the-absurd, while Obama was giving the EU leaders a shove, the U.S. debt was downgraded to negative by the ratings agency Fitch.
Jay Carney, White House press spokesperson said, “Europe needs to take decisive action, conclusive action, and it has the capacity to do so.” Remember this is coming from a White House that spent the past two months campaigning for another stimulus bill and totally ignored the super committee debt fiasco.
About $4.6 trillion in global equities have evaporated this week as concerns over the EU debt crisis spreading have devastated financial markets.
Moody’s Investors Service said today the “rapid escalation” of the crisis threatens all of the region’s sovereign ratings, and the Organization for Economic Cooperation and Development said doubts about the survival of Europe’s monetary union has caused global growth to stall.
Despite attempts from Germany and France to bolster the EU bail-out fund, last week a German bond auction failed to get bids for 35 percent of the 10-year debt on offer. Germany is head and shoulders above the remaining EU countries in financial stability and its inability sell its entire bond offering sent rates higher, further complicating matters for the upcoming meeting of EU financial advisors this week.
Obama has been pressing European governments to act decisively to address the crisis, however his own lackadaisical attitude towards U.S. debt gives him little leverage across the pond.
Obama has spent more time talking with German Chancellor Angela Merkel and French President Nicolas Sarkozy than he has Congressional leaders. Today the president made another attempt at pushing the EU to quickly address their debt issues, but Mr. Obama couldn’t even summon the attendance of either Merkel or Sarkozy.
Carney said the European crisis is a reminder that the global economy is interlinked and the U.S. must do its part as well to help growth. He said the president’s push to extend a temporary cut in the payroll tax is one way to make sure the U.S. recovery continues. What about our debt Mr. Carney? If Mr. Obama spent one-tenth the time focusing on the debt in the U.S. as he did campaigning for his latest pay-offs to political donors perhaps there would be some growth in our economy. Mr. President: our biggest problem isn’t spending in Europe, it’s spending in the U.S. American employers aren’t withholding hiring because Greece and Italy can’t pay their bills, it’s cause the U.S. has to borrow from China to pay ours. Clueless.