| WROCLAW, Poland, Sept 16
WROCLAW, Poland, Sept 16 It was an unprecedented
visit designed to spur the euro zone into action. But Treasury
Secretary Timothy Geithner's high-profile trip to Europe left
some European officials more dumbstruck than starstruck.
Geithner's decision to travel to the small city of Wroclaw
to discuss the sovereign debt problems of Greece, Ireland, Italy
and the wider euro zone was the clearest indication yet of the
severity of the near two-year-old crisis, which now threatens
the global economy not just the single currency bloc.
Officials said Geithner was coming to propose how the region
might try leveraging its emergency bailout fund -- the 440
billion euro European Financial Stability Facility -- to better
tackle the crisis, much as the United States used leverage to
handle the fallout from the subprime collapse.
But however good Geithner's intentions, the indications were
that the meeting did not go as smoothly as he might have hoped.
Held in a concert hall, the gathering lasted for about 30
minutes. The euro zone ministers arrived together by bus.
Geithner was sped to the doors in a private car.
There was no word on whether voices were raised or what the
temperature of the exchanges was, but Austria's finance
minister, for one, was less than warm to Geithner's message.
"I found it peculiar that even though the Americans have
significantly worse fundamental data than the euro zone that
they tell us what we should do and when we make a suggestion ...
that they say no straight away," Maria Fekter told reporters
afterwards, recalling a difference of opinion between Geithner
and German Finance Minister Wolfgang Schaeuble on how to
reinvigorate the euro zone and tax financial deals.
Although some dropped hints of disagreement behind the
meeting's closed doors, few were prepared to disclose Geithner's
full prescription to heal the euro zone crisis.
"He was very succinct. He was kind of headlining, that is
the way he deals with things," said Irish Finance Minister
Michael Noonan, adding that the leverage plan was the main
thrust of what Geithner had delivered.
But his language was perhaps too blunt for European
ministers, fatigued by the crisis and the countless
disagreements it has prompted amongst them.
"We can always discuss with our American colleagues. I'd
like to hear how the United States will reduce its deficits ...
and its debts," Belgian Finance Minister Didier Reynders said
Jean-Claude Juncker, the chairman of the Eurogroup, was even
more to the point.
"I don't think it would be wise for me to report from an
informal meeting that we have with the treasury secretary. We
are not discussing the expansion or increase of the EFSF with a
non-member of the euro area," he said.
The clearest sense of Geithner's thoughts came after the
meeting, when he briefed policymakers and bankers on his views
of the crisis.
"Of course your financial challenges in Europe are within
your capacity to manage financially, you just have to choose to
do it," Geithner told the audience, sitting cross-legged and
slightly slouched in his chair.
"And that is why I said how important it is to us that
Europe doesn't face a protracted period of weakness," he said,
answering a series of polite questions delivered by Polish
Finance Minister Jacek Rostowski.
But he also spoke openly about his concerns.
"One of the starkest ways to emphasize the importance of
Europe getting on top of this is that you don't want the future
of Europe to rest in the hands of those who provide financing to
the IMF," he said.
"There is no reason for Europe to be in that position and it
would be very damaging to the credibility of the endeavour here
in Europe," he said, before departing to warm applause.
But his frank tone and warnings of "catastrophic risk" is
unsuited to European diplomacy.
For many in the meeting, Austria's Fekter most particularly,
his message fell flat.
"I had expected that when he tells us how he sees the world
that he would listen to what we have to say," she said.
(editing by Ron Askew)