"Europe has clearly proven that austerity was the wrong policy to pursue during a recession," says Rep. Maurice D. Hinchey, D-N.Y., a member of the Congressional Joint Economic Committee. "I'm surprised that with such strikingly different recoveries occurring between the United States and Europe that so many United States lawmakers will continue to support the same types of policies that are utilized by Europe."
Many European countries have already slipped back into recession.
Greece's June 17 election could result in the country quitting the euro. International economists are not sure what would happen next.
The economy of Greece is tiny, and its withdrawal alone would not have much impact on the global economy. On the other hand, it could trigger investor panic into pulling money out of bonds of other weak European countries such as Spain, Portugal, even Italy.
"Europe is on the precipice. And the odds are uncomfortably high they go over the ledge," said Mark Zandi, chief economist at Moody's Analytics. He's hopeful European countries will bury their differences and work together to keep the eurozone from shattering. "But if they don't, then the European economy will sink deep in recession and take the rest of the global economy with it, including our own."
The European Union, composed of the 17 countries that use the euro and 10 others, is the world's biggest trading entity, bigger than either the United States or China, the world's two biggest single economies.
And that could have dire consequences for Obama and other incumbents running for re-election.
Michael Froman, Obama's adviser for international economic affairs, said he's optimistic some consensus can be reached that doesn't emphasize austerity as much as measures to "spur on further demand to help make sure that the recovery is secured."
He said the eurozone crisis is sure to be a top topic at a summit of the world's 20 leading economies in Mexico later this month. He said he expects to see there "an overwhelming consensus that the focus is on growth."
Obama said Friday he has been in constant contact over the past two years with Merkel and other European leaders about the crisis. Before the afternoon had ended, the White House said Obama had spoken again with the French president, Francois Hollande, a new partner for Obama in the U.S. push for economic stimulus in Europe, not just austerity.
But there are no immediate plans for any influx of American cash.
Romney and his campaign aides agree that Europe is in bad shape, but they say it's due to excessive spending on social programs and not enough fiscal discipline. Obama's policies on spending and taxes will "take America on the path to Europe," Romney tells campaign audiences.
"It's not that we don't think that this president is trying. I think he is. It's just that his policies are not working," said Romney campaign adviser Eric Fehrnstrom.
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