EU Leaders Call for Continent’s Economic Consolidation

Posted November 16th, 2011 at 1:00 pm (UTC-5)
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Key European Union officials say the continent needs to oversee the spending of individual countries to ensure the survival of the euro currency and resolve the burgeoning debt crisis.

Both European Commission President Jose Manuel Barroso and EU President Herman Van Rompuy called Wednesday for further integration of Europe's economic affairs. Barroso told the European Parliament in Strasbourg that the continent is “now facing a truly systemic crisis.” He said that without increased continent-wide meshing of economic interests and oversight, “we will not be able to sustain the common currency.”

Meanwhile, economist Mario Monti was sworn in as Italy's prime minister. He unveiled a Cabinet of technocrats to try to impose austerity measures in an effort to trim his government's $2.6 trillion debt and calm international financial markets.

Mr. Monti named himself finance minister and did not include any of the country's fractious politicians in the Cabinet. The former European Union commissioner said the exclusion of politicians in his government will actually help it.

The new caretaker government in debt-ridden Greece faced a confidence vote Wednesday. Prime Minister Lucas Papademos was expected to survive, but Mr. Papademos still faces a daunting task of avoiding a financial collapse and imposing hugely unpopular spending cuts and tax increases.

Tensions surfaced early Wednesday when the country's electricity workers' union briefly cut off power to the health ministry building. Union officials said the shutdown was part of their protest of a tax on property owners — a tax the government is trying to collect through household electricity bills.

Mr. Papademos is specifically tasked with getting parliament to approve a new bailout deal with the European Union. Greek officials warn the country faces bankruptcy without the new funding and an $11 billion installment of last year's bailout.

In Italy, Mr. Monti said he is absolutely convinced that the country can make the sacrifices needed to overcome its debt crisis. The prime minister-designate also assured Italians he has the backing of political, business and union leaders. Nonetheless, a headline in a newspaper owned by outgoing Prime Minister Silvio Berlusconi said, “He Can't Last Long.”

Italy is the eurozone's third-largest economy. Fears that Italy might default on its debt or be forced to ask for a bailout have shaken financial markets around the globe.