Europe Balks At Helping U.S. Dig Out Of Fiscal Hole

While Treasury Secretary Henry Paulson is pressing Congress to pass his $700 billion plan to bailout the financial sector, he's also asking foreign countries for assistance. But France and Germany are not likely to get aboard. Many Europeans now feel that their model of tighter regulation and more government involvement has been vindicated.


The French, as well as the Germans, have been somewhat protected from the turmoil by greater regulation in their financial systems, but they're still watching the crisis with fascination. From Paris, Eleanor Beardsley has this report.

ELEANOR BEARDSLEY: Some of the newspapers in Paris and Berlin seem to be reveling in the sort of American high finance. Left-leaning French daily Liberacion said they never saw it coming, and one magazine cover announced the death of neo-capitalism. In continental Euro-zone Europe, where mortgages are not given out like candy and naked short selling is illegal, there isn't much sympathy for what people see as Wall Street's careless demise. German Chancellor Angela Merkel says Britain and the U.S. ignored her calls last year for more market regulations. Germany says it will not participate in the American bailout because it doesn't need it, and it fears the aid could lay the foundation for a future financial crisis.

ANGELA MERKEL: (German spoken)

BEARDSLEY: Merkel told a crowd in Austria this weekend that while profits from shady financial products often benefited Americans, their losses had been spread nicely around the globe. French President Nicolas Sarkozy, known to support free markets, often lambasts what he calls the immorality of speculative capitalism. Speaking to a business group last night in New York ahead of his appearance at the United Nations today, Sarkozy said those responsible for the global crisis should be punished and held accountable. But so far, no French bank has gone under.

CHRISTINE LAGARDE: (French spoken)

BEARDSLEY: French Finance Minister Christine Lagarde said she and Sarkozy had pushed for more regulation and transparency, but their British and American counterparts didn't want to listen. Many Europeans now feel that their model of tighter regulation and more government involvement has been vindicated. For NPR news, I'm Eleanor Beardsley in Paris.

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