March 1, 2024

Merkel Rallies Wary Coalition Ahead of Vote on Greek Aid

With the Greek prime minister, George A. Papandreou, in Berlin for talks, Mrs. Merkel sought to sway public opinion ahead of a vote Thursday in Parliament that some lawmakers have said is her most important legislative test since taking office nearly six years ago.

“Through the euro we are closely bound together and the weakness of one affects us all,” Mrs. Merkel said during a joint news conference with Mr. Papandreou at the Chancellor’s office, which came shortly after the Greek Parliament voted to back a hugely unpopular new property tax — one of a series of new austerity measures that will clear the way for Greece to receive financing it needs to stave off default.

“I know that a lot is being asked of the Greek people,” Mrs. Merkel said, before a dinner with Mr. Papandreou. But she added that she was confident that Greece would fulfill conditions set by international lenders, and promised that Germany would be supportive.

But she tempered her remarks by insisting that Germany was “not available” for further steps like jointly issued bonds guaranteed by all euro zone members — an idea that Germany has staunchly resisted. And the German finance minister, Wolfgang Schäuble, ruled out an increase in the size of the euro zone bailout fund, though not necessarily an increase in its ability to borrow.

Critics have accused Mrs. Merkel of failing to show strong leadership and allowing the debt problems of one small Mediterranean country to grow into a global threat that even prompted a tentative offer of aid Tuesday from worried officials in Japan.

In recent days, European officials have faced intense pressure from concerned counterparts in the United States and Asia to prevent further spread of the debt crisis. The browbeating seems to have had some effect.

During appearances since Sunday, Mrs. Merkel has shown more willingness to risk her political prestige to win over skeptical Germans, whose money and support is crucial to any resolution of the sovereign debt crisis.

But she continued to put much of the onus on Greece. “The all-important thing is — and we will provide every assistance that is wanted from the German side — that Greece wins back confidence; that we get out of this terrible development that there is bad news every month,” she said.

Mr. Papandreou, in recognition that his country’s fate hangs to a large extent on decisions made in Berlin, tried to soothe some of the ill will that has built up between the two countries. Germans resent what they perceive as Greek unwillingness to live within their means, while in Greece the crisis has revived stereotypes of bossy, arrogant Germans.

“We must stop blaming each other for our different weaknesses and unite together with our different strengths,” Mr. Papandreou said during a speech to the same business group that Mrs. Merkel addressed. “Even Germany depends on Europe, its biggest trading partner, for growth and jobs.”

German lawmakers are certain to pass a bill that would bolster the main European bailout fund, known as the European Financial Stability Facility. But it would be a blow to Mrs. Merkel’s waning prestige if dissent in her own coalition required her to seek support from the opposition Social Democrat and Green parties.

“Why a stability program?” Mrs. Merkel told a gathering of her Christian Democratic Union in Karlsruhe, Germany, on Monday. “Not because we want to take over Greece’s debts, but because otherwise the euro would become unstable.”

Lawmakers in Slovenia voted Tuesday to approve their share of the rescue fund’s guarantees. Finland’s Parliament is expected to reluctantly approve the fund measure in a vote Wednesday, despite formidable domestic opposition. All 17 members of the euro zone must ratify the expanded fund, a process that has delayed its implementation.

The fund will have the power to buy European government bonds and recapitalize struggling banks. But some analysts have said the fund needs to be two or three times bigger to remove any doubts about its impregnability.

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