With European Union (EU) leaders meeting in Brussels today amidst growing concern that Greece may abandon the euro after receiving about $500 billion in global bailouts, Rep. Cathy McMorris Rodgers (R-WA), Vice Chair of the House Republican Conference, released the following statement warning that the decisions by the EU, the International Monetary Fund (IMF), and the Obama Administration to paper over the European debt crisis with bailouts -- partly funded by U.S. taxpayers -- will fail and the only way to truly solve the crisis is through serious fiscal discipline:
"At this point, it should be clear that America and the IMF are throwing good money after bad, and the only real solution is for Greece and the European Union to stop their borrowing addiction, instead of papering it over. The Greek bailout, in particular, has been a failure. When the bailouts began in May 2010, Greece's debt-to-GDP ratio was 113 percent. Today, it's 159 percent. And Greece continues to run a deficit equal to 10 percent of its economy. There is no way for Greece to start reducing its debt burden until those deficits stop. It's just simple math. Of course, that's equally true for America. We're not that far behind. Which is why we must start getting serious about protecting U.S. tax dollars and ending the "too big to fail' philosophy. The only thing "too big to fail' is America itself."
Nearly one-third of the Greek bailout is financed by the IMF, and the U.S. is the largest contributor to the IMF. In March 2010, Rep. McMorris Rodgers was the first Member of Congress to publicly oppose U.S. participation through the IMF in the EU bailouts. She is the author of HR 2313, which would rescind what remains of a $100 billion line of credit to the IMF (created in 2009, known as the "New Arrangements to Borrow"), which is being tapped for the European bailouts. The bill has 94 cosponsors.
"The purpose of reducing our IMF funding to pre-Obama levels isn't to punish Europe. Rather, it's meant to help Europe make the tough choices that are necessary for a true, sustainable recovery. That recovery can't happen until job creators -- in Europe and the U.S. -- gain confidence that the world's governments have the discipline to get spending and borrowing under control and unleash the power of free enterprise."