In a few minutes, we're going to hear about how wealth and debt in Europe flowed from the invention of banks. In Florence, Italy, merchants came up with the banking system that encouraged international trade at the dawn of the Renaissance.
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These days, of course, a debt crisis has wiped out many European banks, forced countries to seek bailouts, and toppled governments.
MONTAGNE: So let's go first to NPR's Philip Reeves in Brussels for an update on the latest gathering of European leaders hoping to solve or at least stem the debt crisis. Good morning, Phil.
PHILIP REEVES, BYLINE: Good morning.
MONTAGNE: So what, if anything, did they achieve in this gathering yesterday?
REEVES: Well, they took a step along the difficult and politically perilous path to European fiscal union. There are 27 countries in the EU and all but two have now agreed to a treaty that's designed to shore up the euro by making the countries that use that currency obey much stricter rules. For example, there will penalties for nations that break deficit limits. Those countries will lose a degree of sovereignty, but they seem to think it's worthwhile if it means Europe will avoid another catastrophe. The only two nations that didn't support the pact were Britain and the Czech Republic.
MONTAGNE: And I mean I hate to say it like this, but why does this matter?
REEVES: Well, it matters in the immediate sense because it's a victory for Germany's Chancellor Angela Merkel. She's been pressing really hard for this. In fact, she originally wanted to make it an EU treaty so that it would have more teeth, but the British vetoed last month, causing quite a row. German domestic politics are in play here. The German taxpayers are getting fed up with bailing out eurozone countries that have gone bust. And this treaty allows Merkel to say that nations won't be allowed to run up massive debts again. But there are obstacles in all this. You know, the treaty's not ratified and then an election's coming up in France. The president, Nicolas Sarkozy, might lose. His opponent's already talking about renegotiating the treaty.
MONTAGNE: So you're talking about sort of future fixes there. Was there any progress in fixing Europe's current debt crisis?
REEVES: Well, there was certainly a change in tone. You know, until now the focus has all been on austerity, really, but the summit shifted the emphasis towards creating growth. Europe's leadership's been under a lot of international pressure to do more to stimulate growth, and they seem to be taking that onboard. The Europeans are really, really worried about their rising unemployment levels, especially among young people. In Spain, nearly half those aged between 16 and 24 are without work, and the summit especially emphasized the need to create jobs.
MONTAGNE: There was an uproar in Greece this past weekend over a highly controversial German proposal to have an EU commissioner supervise the Greek budget - that is, look over Greece's shoulder. Did that idea get much support there in Brussels?
REEVES: No one seemed to want to have anything to do with it. Sarkozy, who's become a very closer partner of Merkel's throughout this crisis, was openly critical. He called it unreasonable and undemocratic. So it generally looks like that idea is not going to fly.
MONTAGNE: Phil, thanks very much.
REEVES: You're welcome.
MONTAGNE: NPR's Philip Reeves speaking to us from Brussels. Transcript provided by NPR, Copyright National Public Radio.
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