Italy’s Monti Blames Germany, France for Debt Crisis

Posted March 28th, 2012 at 10:05 am (UTC-5)
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Italian Prime Minister Mario Monti says he thinks the European governmental debt crisis is “almost over,” but on Wednesday blamed German and French actions a decade ago for causing it.

The Italian leader, speaking to investors in Tokyo, said Germany and France “were loose” in 2003 in controlling their budget deficits and debt just four years after the euro became the dominant currency in Europe.

Germany and France are the continent's two strongest economies. But Mr. Monti said that if “the father and mother of the eurozone are violating the rules” to control spending, one could not expect Greece and other debt-ridden countries to keep deficits in check. In the last two years, Greece has had to secure two international bailouts to avoid defaulting on its financial obligations, while Europe has also sent rescue packages to both Ireland and Portugal.

But Mr. Monti said he believes the worst of the crisis is nearing an end.

“The eurozone has gone through a crisis, a huge crisis. I believe that this crisis is now almost over, but there has been a defining, delicate moment last autumn when Italy was becoming a component of this crisis.”

He said austerity measures imposed in Italy and labor reforms will boost Europe's third biggest economy, even as Italian labor unions have called for short work stoppages to protest regulations that would make it easier to dismiss workers.

“And this is a reform that of course is implying some resentment, some discussions, some bitter discussions in the country now, but I have the impression that a majority of Italians perceive this as a necessary step.”

Mr. Monti was a member of the European Commission in the early 2000s. During that time, the commission recommended sanctions against Germany and France because they were exceeding a eurozone requirement that they keep their budget deficits to less than 3 percent of their national economic production.

But the European Council, comprised of elected officials, vetoed any sanctions.