How the American taxpayer might be exposed to the eurozone's
debt crisis was the primary concern at a recent congressional
hearing in Washington.
Members of the subcommittee on International Monetary
Policy and Trade grilled the U.S. Treasury Assistant
Secretary for International Finance, Charles Collyns, about
the administration's handling of the issue.
European Union (EU) leaders and officials have been
consulted with the U.S. Administration, the U.S. Treasury
and the International Monetary Fund (IMF) as EU members
develop a plan they can all agree on to resolve the debt
crisis.
European leaders were due to announce a plan last weekend
but an agreement could not be reached. Hopes remain that
the emergency European leaders's summit in Brussels on
Wednesday was the beginning of the resolution.
Europe buys 20% of America's export and 35% of its services
making it America largest trading partner. The trading
generates in excess of $4 trillion dollars.
The United States is the largest foreign investor in Europe
and Europe is the largest foreign investor in the U.S.
The interconnectedness made the eurozone's financial crisis
a key concern for the U.S.
Assistant Secretary Collyns was repeatedly asked what the
exposure might be for U.S. taxpayers and more directly, is
any taxpayer money had been used to bail the Europeans out.
He stated that "our participation does not involve an
commitments of taxpayer money.
The U.S. government was financially involved through the
IMF which had contributed roughly one-third of the funds
needed to date. Collyns stated that this does not put
the U.S. tax payer at risk because he says the iMF has
a strong creditor status and the U.S. taxpayer has never
lost a cent through its exposure to the IMF>
Sheila McKinney
