The Group of 20 meeting in Mexico City over the weekend decided that the best course of action was inaction, putting off making any decisions on how to “rescue” the European Union from its financial and economic difficulties until next month at the earliest. The statement justifying kicking the can down the road for another month or so was breathtaking in its obfuscation: putting off any decisions, it said, “will provide an essential input in our ongoing consideration to mobilize resources…” This is how finance ministers and world economic experts explain that, after two days of meetings, the best thing to do was nothing at all.
There were great expectations before the meeting ended that something of substance would come out of it. The plan was not only to pave the way for the second bailout of Greece but for each of the G-20 members (including the U.S. and most of the other industrialized nations on the planet) to pony up additional taxpayer funds to the International Monetary Fund (IMF) which would then be used, at its discretion, to bail out over-indebted countries like Greece, Portugal, Spain, and others as they need them. Expectations were that commitments totaling $1 trillion would be made before the end of the meeting on Sunday.
Plans went awry when Germany’s Chancellor Angela Merkel (photo), responding to pressure from more sensible voices, said Germany would be unable to participate in any further assistance. This reluctance no doubt stems from the fact that the German parliament, the Bundestag, still hasn’t approved the Greece bailout. So making a further commitment when the previous promise to Greece is still pending was the politically prudent thing for her to do.
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Photo: German Chancellor Angela Merkel delivers her speech prior to the debate and the voting of the German Parliament Bundestag about a new Greek rescue package in Berlin, Germany, Feb. 27, 2012