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News Wrap: Leaders in Italy, Greece Move to Form New Governments

November 14, 2011 at 12:00 AM EDT
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HARI SREENIVASAN: New leaders in both Greece and Italy moved to form governments today. Both will have to persuade voters and financial markets to support their efforts and prevent Europe’s debt crisis from spreading.

We have a report from Gary Gibbon of Independent Television News.

GARY GIBBON: At the weekend, Silvio Berlusconi waved goodbye to office and to imaginary supporters. Most of the crowd here was anything but supportive, shouting, “Go to jail” and thanking God for Silvio Berlusconi’s departure from office.

Is their savior staying here? Mario Monti, the new prime minister, emerged from the sort of hotel Silvio Berlusconi wouldn’t be seen dead in. Mr. Monti is still trying to form a government he hopes can last for 18 months.

With the new man in place, Italy did manage to shift 3 billion euro of government debt on the markets today, but at an interest rate over 6 percent, a new, lousy Eurozone record, 1 percent up on just last month.

In Spain, where anti-banking protesters have been on the streets, the price of Spanish government debt entered the danger zone, going above 6 percent. It’s not clear whether Greece’s Parliament will back the new Brussels-approved prime minister who is trying to form a government.

Lucas Papademos needs the support of the main opposition right-wing party. But their leader is tonight refusing to sign an EU-IMF pledge to back the cuts and is itching for an early general election.

At her party conference in Leipzig, the German chancellor, Angela Merkel, implied Eurozone countries would have to take a lot more austerity measures. She said, to survive, the euro needed member states to move to economic union, matching tax-and-spend policies.

“Europe is in one of its toughest, perhaps the toughest hour, since the Second World War,” she said. “If the euro fails, then Europe fails. And we want to prevent and we will prevent this.”

The technocrats Angela Merkel wanted in power in Athens and Rome are in place. But it’s not clear how long they will last or if the markets will give them even a moment to try their policies.

HARI SREENIVASAN: The situation kept Wall Street on edge today. Stocks drifted lower amid concerns that the new governments in Greece and Italy face huge challenges. The Dow Jones industrial average lost 74 points to close just under 12,079. The Nasdaq fell 21 points to close at 2,657.

Before dawn today, police in Oakland, Calif., cleared an encampment of anti-Wall Street protesters. Officers in riot gear moved in to empty the area in front of Oakland City Hall. They cleared away tents that had been set up for weeks. At least 32 people were arrested. Mayor Jean Quan said shutting down the camp was necessary after a man was murdered nearby last week.

JEAN QUAN, mayor of Oakland, Calif.: We’re asking everyone to respect my city’s decision to close the encampment, even if we support the movement.

I’m asking you to not engage in destructive acts. I’m asking you to respect what now has become, I think, an overwhelming sentiment in the city, that you can divide the movement from the encampment, and that we start to work together on the issues that unite us and not divide us.

HARI SREENIVASAN: A similar scene took place in Portland, Ore., overnight, where thousands of protesters were cleared from their encampment. More than 50 people were arrested there.

In Brazil, more than 3,000 police and soldiers have taken over the country’s largest slum, in a new bid to curb the power of drug traffickers. Early on Sunday, armored vehicles rolled in to a section of Rio de Janeiro where a heavily armed drug gang had run things for years. Units made their way through narrow streets, seizing the town in just an hour-and-a-half without firing a single shot. It’s all part of a campaign to increase security before the city plays host to the 2014 World Cup and the 2016 Olympics.

Ten percent of all adults in the world could have diabetes in less than 20 years. The International Diabetes Federation made the prediction today, based on aging and other factors. The advocacy group estimated that by 2030, there will be 552 million cases of diabetes worldwide. Currently, 346 million adults are diabetic. That’s about one in every 13.

Those are some of the day’s major stories.