Germany rejects bailout plan for east EU nations

[Swede]

Source: Associated Press

BRUSSELS (AP) — Germany rejected appeals Sunday for a single multibillion euro (dollar) bailout of eastern Europe, even after Hungry begged EU leaders not to let a new "Iron Curtain" divide the continent into rich and poor.

The swift, strong comments by German Chancellor Angela Merkel dampened hopes that leaders at Sunday's European Union summit could forge a unified stance to tackle the worsening economic crisis.



Read more: http://www.google.com/hostednews/ap/article/ALeqM5h_fkxnBI3-FZ5aibVXlv01Dc9DPwD96LA78G2

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I'm starting to believe the Eastern Europe is a domino teetering.

[Sultana]

1. Oh shit, hold on folks

[kickysnana]

2. Oh-oh kick

[WriteDown]

3. Looks like the EU was not all it was cracked up to be...

Also, Hungry is a terrible name for a country :).

[PSPS]

6. Yeah, you've got to hand it to those crack AP copy editors

I guess they're too busy massaging their bush/iraq/GOP coverage into the requisite hagiography style.

[dipsydoodle]

7. It defeats me

how AP could make a spelling mistake that stupid.

[harmonicon]

8. The AP has become a complete joke

I don't dismiss every single AP story, but I'm always skeptical. Their shit reporting and blatant political objectives have discredited the entire organization for many, including myself.

[ohio2007]

12. Stringers don't use google translate most likely.

[LiberalFighter]

17. Constant Brand is the writer. Maybe someone should findout if s/he

attended one of those creationist schools for their education.

[Swede]

10. I copy and pasted right from the source.

:shrug:

[xchrom]

4. recommend

[BartMang]

5. LOL Hungry? I think you mean Hungary.

Yeah, being born in Eastern EU, I fear for the financial future of my homeland.

[WheelWalker]

9. Yikes !

:nuke:

[ohio2007]

11. Betcha Kucinich would approve of Germany's decision. Seems few in the US were able to say NO

to bailouts other then Dennis

water under the bridge

[Idealism]

13. You have no idea, Swede!! Eastern Europe is about to fall.

Most of the mortgages on eastern European homes were secured through Swiss banks, because the interest rate was lower and there was enough capital to lend to these ex-Soviet satellites. Because the interest rates were low, it fueled a huge real estate boom across all of Eastern Europe especially, where you had incredible economic growth in a short period of time. Germany was hit hard with regards to real estate, too, but they have a strong and well rounded economy, where as the newly-capitalist eastern European countries didn't have a well-developed private sector that could sustain much of a downturn.

When the global crisis started to hit, and the manufacturing output of the world slowed to a crawl, it particularly hit hard in Eastern Europe because of their industry-centered economies and the ferocity of real estate speculation. This devalued their currency greatly, in some cases it has cut the value in half. Now, the Franc has also been hurt by this but due to low inflation it has held much of its value, as opposed to Lats (Latvian currency) or hryvnya (Ukrainian). Latvia and Ukraine have inflation around 20% and it will only go higher.

The biggest problem is what the article talks about: Why should German or French taxpayers pay to bail-out Eastern Europe?

This will greatly stress the tenuous EU alliance. Russia, if commodity prices rebound soon, will step into the void and we may very well see a return of the Iron Curtain.

[TheLastMohican]

20. No Iron Curtain I believe

Russia had been stupid in the past to feed all those Warsaw Pact countries which changed sides the first opportunity they got.
Now, Germany is telling it in very clear terms that nobody is going to feed you like Soviet Union did and that everybody for himself.
Russia is just leering and watching from the sidelines.

[Hardrada]

14. Bail out Poland by buying back Pomerania and Silesia.

There's a plan. Germany did try to buy back part of East Prussia a few years ago but Russia nixed the deal.

[LiberalFighter]

18. Wasn't Poland Pomerania before it became Poland?

[Hardrada]

19. Iif you go far enough back, I think the area was Lithuanian

But Pomerania was German for a few centuries before the unfair Versailles Treaty
gave it to Poland.

[muriel_volestrangler]

21. No, though Pomerania has been divided and reallocated between Poland,

Germany (or Prussia/Brandenburg) and Sweden for hundreds of years. See http://en.wikipedia.org/wiki/Pomerania . The current German-Polish border is further west than it has generally been, largely due to the agreement at the end of World War 2.

[Ghost Dog]

15. Misleading headline, and little meat to the story.

Hungarian Prime Minister Ferenc Gyurcsany has called for an EU fund of up to €190 billion ($241 billion) to help restore trust and solvency in those nations, but Merkel has insisted that a one-size-fits-all bailout would be unwise, since the situation is different in different countries.

This morning's AFP report simply says:

While Austria has been urging measures to help eastern Europe, most other countries, including the European Union's current Czech presidency have ruled out special treatment for the region.

"I don't believe that it is necessary now to separate several countries in the European Union," Czech Prime Minister Mirek Topolanek told journalists as he arrived to chair the emergency EU summit.

"I will support an individual approach of the European Union to help and support any countries or European countries, (and) not especially eastern Europe."

Reuters this evening summarises thus:

...

Gyurcsany said it was time to unify Europe, as happened when communist rule ended in eastern Europe two decades ago.

"At the beginning of the 90s we reunified Europe. Now it is another challenge -- whether we can unify Europe in terms of financing and its economy," he said.

Despite his remarks, the summit agreed merely to look at helping any countries in difficulty on a case-by-case basis.

"The EU is going to leave no one in the lurch ... but that (regional) approach was rejected," Gyurcsany said.

Addressing concerns of protectionism, leaders said the single market should be used as an engine for economic recovery.

"We agreed that as much as possible we should use the single market as a motor for growth," said Topolanek, whose former communist country holds the EU presidency till the end of June.

...

So, financial assistance to Eastern EU countries may be provided on a case-by-case basis, and not by means of a general fund.

AP, along with some others, is sensationalising, and greatly exaggerating the degree and the nature of 'divisions' in the EU, as far as I can see from here, as part of a not-very-hidden agenda. In fact, as Reuters reports in the above article titled "EU ready to examine faster memberships", the big story out of today's meeting is surely the agreement to speed up the process of integration into the Euro Zone, while at the same time emphasising that the requirements for integration will not be relaxed.

[Name removed]

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