Geithner, Schaeuble Spar Over Crisis as G-20 Hits IMF Impasse

By Alan Crawford and Rainer Buergin

Feb. 26 (Bloomberg) -- The U.S. and Germany sparred about how to tackle Europe’s sovereign debt crisis as a meeting of officials from the world’s biggest economies struggled to break an impasse over outside help for the region.

U.S. Treasury Secretary Timothy F. Geithner used a speech in Mexico City yesterday to urge Europe to step up its actions and render its crisis-fighting commitments “credible.” German Finance Wolfgang Schaeuble rebuffed those calls two hours later, saying a deal struck on Feb. 21 for a second bailout and debt write-down for Greece worth 130 billion euros ($175 billion) demonstrates that Europe is doing enough.

“I dare to say that Europe has done its homework,” Schaeuble said in a speech in the Mexican capital. Tightening bond spreads in the euro region “show that we’re on the right course” while budget cuts and more flexible labor markets and wages are necessary to spur economic growth and bolster the euro in the longer term, he added. “That’s the only way we’ll be able to restore confidence,” he said.

Read more: http://www.businessweek.com/news/2012-02-26/geithner-schaeuble-spar-over-crisis-as-g-20-hits-imf-impasse.html