Obama wants European debt action after EU summit

Obama said that the United States would do its part to help resolve the EU crisis President Barack Obama told top European officials they must act now, with decisive force, to fix the debt crisis threatening to consume the eurozone and damage the fragile US recovery.
Obama said that the United States would do its part to help resolve the situation, but did not specify any action over and above its intense diplomatic engagement and current financing levels for the International Monetary Fund.
"This is of huge importance to our own economy," Obama said, after meeting European Council President Herman Van Rompuy, European Commission President Jose Manuel Barroso and EU foreign policy chief Catherine Ashton.
"I communicated to them that the United States stands ready to do our part to help them resolve this issue," he said, adding that it would be tougher for his administration to create jobs at home if European markets were contracting.
While Obama was diplomatic in public, there were signs of a more robust attitude inside the talks on eurozone risks, which aides fear could deepen US economic woes already threatening his 2012 reelection bid.
"The president has made clear repeatedly and he did so today, that he would like to see bolder, quicker, more decisive action by European leaders," said William Kennard, US ambassador to the European Union.
"We have gotten into detail in private conversation about what that might entail," he said.
White House spokesman Jay Carney said Washington wanted Europe to take firm action to ease a crisis, which some analysts say could put the euro's survival in doubt.
"This is something they need to solve and they have the capacity to solve," Carney said.
"Our position is, and has been, that it's critical for Europe to move with force and decisiveness now, particularly with new governments coming into place in Italy, Greece and Spain."
One possible way for Washington to do more to stabilize Europe would be to hike its payments to the IMF, in which it is already the largest single investor. But Kennard ruled out such a step Monday.
"I want to be very clear. There was no discussion about the United States increasing its commitment to the IMF or making any other financial obligations to the EU in the course of them seeking solutions to this crisis," he said.
"That was not part of this discussion."
Obama has however frequently discussed the eurozone crisis with leaders including German Chancellor Angela Merkel and French President Nicolas Sarkozy, and strongly backed previous European efforts to ease the crisis.
Van Rompuy said after meeting Obama that the European Union was going through a "difficult period" but defended what he said had been hitherto "unthinkable" measures to try to restore growth.
"But we have to do more," he said.
The White House talks went ahead amid new fears for the European economy and the potential for wider contagion.
A study by Fitch ratings agency published last week warned that exposure of the US financial sector to European countries and banks was "sizable."
The Organization for Economic Cooperation and Development (OECD) warned that policymakers were failing to see the urgency of acting to tackle risks to the global economy, and rapped the United States as well as Europe.
And Moody's Investors Service warned that all European Union sovereign debt ratings, not just those of teetering nations like Italy, Greece and Portugal, were at risk, pointing to a widening of the crisis.
Washington's moral standing on the issue has also been called into question by its failure to make its own tough political decisions needed to fix its bulging deficit, with little movement likely ahead of a 2012 election year.
A joint statement issued by the two sides after Monday's summit made clear that "the EU looks forward to US action on medium term fiscal consolidation."
Reports said Monday that key eurozone leaders were considering a push for strict new budget rules for member states to fix the crisis, rather than recommending changes to EU treaties, which could take years.
Though the eurozone is overshadowing trans-Atlantic diplomacy, Obama said that on most areas there was great agreement.
The two sides called in a statement for an end to violence against anti-government protesters in Syria, expressed "deep concern" about Iran's nuclear program and noted an "historic" opportunity for progress following the Arab Spring.