US will not help pay for Europe's debt woes

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US will not help pay for Europe's debt woes

By JULIE PACE | AP – 5 hrs ago

WASHINGTON (AP) — President Barack Obama said Monday the United States stands

ready to do its part to help Europe with its deepening debt crisis, even as the

White House ruled out any financial contributions from U.S. taxpayers.

Meantime, a top European official offered his assurances to Obama and the

American people that Europe's leaders fully understood the magnitude of the

crisis. But European Commission President Barroso warned that

decisions on how to solve the economic woes could take time.

The annual meeting between U.S. and European Union officials came amid growing

fears over the future of the euro. Experts say that without drastic action, the

euro could be days away from collapsing, a scenario that could cause more

financial damage to the already shaky American economy.

While Obama offered no specifics on how the U.S. may be willing to assist

Europe, he said failing to resolve the continent's debt crisis could damage a

U.S. economy saddled with slow growth and 9 percent unemployment.

" If Europe is contracting, or if Europe is having difficulties, then it's much

more difficult for us to create good here jobs at home, " Obama said at the

conclusion of the day-long summit.

While Obama has offered support to his European peers, the U.S. believes the

Europeans have the financial capacity to solve the debt crisis on their own.

But some U.S. allies, including Finland and the Netherlands, have called for the

International Monetary Fund to be bolstered with more capital so that it could

in turn help stem Europe's debt crisis from deepening and spreading.

The U.S. is the single-biggest stakeholder in the IMF. And earlier Monday, White

House spokesman Jay Carney said the IMF has substantial resources already.

" We do not in any way believe that additional resources are required from the

United States and from American taxpayers, " Carney said.

European leaders are set to meet Dec. 9 to discuss next steps in tackling the

financial crisis. New ideas were circulating Monday for how to finally cap the

debt woes that began in Greece two years ago and have spread to other larger

economies, most notably Italy.

One idea gaining momentum, was a radical proposal in which countries that use

the common currency would cede control of a big chunk of their budgets to a

central authority. Some say the proposal would be a big leap toward a United

States of Europe, a move that could greatly enhance European stability, but at

the cost, critics say, of national sovereignty and democratic accountability.

Another plan being aired in the face of fierce German resistance is for the

eurozone's six triple A rated nations to pool their resources through a joint

bond to prop up some of the single currency bloc's most indebted members.

Germany, the EU's richest member, rejects the idea because it fears it would be

tapped for the lion's share of the bailout

Back in Washington, Barroso said Europe's leaders are taking strong steps to

solve what he called an unprecedented situation.

" We are absolutely serious about the magnitude of the challenges, " he said. " You

have to understand that sometimes some decisions take time. "

Carney said that Obama, along with Treasury Secretary Geithner, would

continue to stay in close contact with European leaders, including German

Chancellor Merkel and French President Nicolas Sarkozy. Vice President

Joe Biden will travel to Greece later this week to meet with new Prime Minister

Lucas Papademos, who took office earlier this month.

While Monday's meeting between Obama and European Union leaders centered on the

global economy, there were also discussions on supporting democracy in the

Middle East and North Africa, cooperation on counterterrorism and trans-Atlantic

law enforcement, and Iran.