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European Leaders Seek Solutions to Debt Crisis at EU Summit

October 26, 2011 at 12:00 AM EST
European Union leaders gathered Wednesday in Brussels in hopes of reaching a deal to bolster Eurozone relief funds and contain Greece's debt crisis. Laura Kuenssberg of Independent Television News reports from Brussels.
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TRANSCRIPT

JEFFREY BROWN: And we turn to the debt and bank crises in Europe, as leaders, the 17 who use the euro and some who don’t, gather to try to resolve their differences.

We begin with a report from Laura Kuenssberg of Independent Television News in Brussels.

LAURA KUENSSBERG: What is in and what has Germany ruled out? Close attention to the detail of the deal still being done in Brussels tonight may find it falling short. Fine-tuning is going on, but leaving the Eurozone leaders to it, the P.M. said it was on its way.

DAVID CAMERON, British prime minister: We made some good progress tonight. It’s very much in Britain’s interests that we sort out these problems and solve this crisis. We have made good progress on the bank recapitalization. That wasn’t watered down. It has now been agreed. It would only go ahead when the other parts of a full package go ahead.

LAURA KUENSSBERG: But the draft deal on the table seen by ITV News is not all that was promised. That funding for the banks, nearly 100 billion pounds, had already been agreed on Sunday.

There’s no final agreement on the size of the rescue fund to insure other countries against meltdown. It will include public and private money and from the IMF, but won’t be finalized until the end of November. And the draft has no mention of how much Greek debt private investors will agree to write off.

It’s not even been easy to get this far. The Greek leader made this plea on behalf of his country that’s drowning in debt.

GEORGE PAPANDREOU, Greek prime minister: Our challenge today is not simply to save the euro. It’s to safeguard the ideals we cherish so much in Europe.

LAURA KUENSSBERG: And while Italy’s leader, Silvio Berlusconi, was under pressure in Brussels, in his Parliament, M.P.s ended up in a fight about changing the retirement age, an astonishing sign of how controversial it will be for them to cut spending.

While in a somber debate in Germany, Angela Merkel warned her colleagues it was now or never to save the euro.

But the draft of the final agreement I have seen is likely to disappoint. There is no complete deal on the rescue fund and may not be one until the end of next month. There’s hardly a mention of the amount of Greek debt that’s to be written off, not the grand bargain that was promised. All the leaders here do and say they want to save the euro, but in truth they also want very different things.

Angela Merkel has the biggest checkbook and wants to protect the currency, but also wants to prevent Germany’s taxpayers from having to keep promising their cash. Nicolas Sarkozy can’t afford to shell out as much as Germany and wants Europe’s Central Bank’s money to be used in the bailout fund, while Silvio Berlusconi has been told by France and Germany to get his house in order and deliver on his promises to sort out the Italian economy, a much bigger concern than Greece going down, because it’s just so much larger.

Talks are still going on, with the final shape of the deal not expected until midnight. But however long the discussions continue, the end of the crisis is not in sight.