France, Germany push for tough line on Greece

France and Germany said on Sunday that the Eurozone should take a tough line on Greece in exchange for financial aid, with French Economy Minister Christine Lagarde (pictured) saying Athens must be held accountable for "unsuitable economic policies".


REUTERS - European heavyweights Germany and France vowed on Sunday to take a hard line with Greece in exchange for financial support as doubts emerged over whether a 45 billion euro aid package was sufficient to prevent a default.

Greece bowed to intense pressure from financial markets on Friday, requesting funds from the European Union and International Monetary Fund (IMF) in what would be the first bailout of a member of the 11-year-old single currency bloc.

The debt-saddled country has announced billions of euros in austerity measures, including tax hikes and public sector wage cuts, but must now agree additional steps to satisfy the EU and IMF, and ensure the aid flows.

German Finance Minister Wolfgang Schaeuble warned Greece that a tough restructuring of its economy was "unavoidable and an absolute prerequisite" if Berlin and the EU were to approve the aid Greece has requested.

"The fact that neither the EU nor the German government have taken a decision (on providing aid) means the response can be positive as well as negative," Schaeuble told the Sunday edition of German daily Bild.

"This depends entirely on whether Greece continues in the coming years with the strict savings course it has launched. I have made this clear to the Greek finance minister."

Schaeuble's French counterpart Christine Lagarde promised to hold Greece accountable for "unsuitable economic policies" that pushed its 2009 budget deficit to 13.6 percent of gross domestic product (GDP) and its debt to 115 percent of economic output.

<SNIP>http://www.france24.com/en/20100425-eurozone-needs-strict-greece-french-economy-minister-lagarde

You don't just whistle in the dark while your trade partner can't get their act together and are threatening to take you down with them.

America and Canada should suspend Mexico from NAFTA until the Mexican Government cleans up their own internal problems.

Former Goldman Sachs banker and former national Democratic Party finance chairman Phil Murphy
was chosen in Sept. 2009 as ambassador to Berlin.
So it might be worth a peek behind the headlines to see what is really going on.