The U.S. president's reelection in November seems to be more and more uncertain as the financial storm in Europe continues to devastate people's and the markets' hopes that European leaders will finally find a way to put an end to the current eurozone drama. Although the constant calls made from U.S. President Barack Obama, Treasury Secretary Timothy Geithner and the Chairman of the Federal Reserve Ben Bernanke for the necessity of Europeans undertaking much bolder, decisive and effective steps towards resolving the common currency's crisis, what is happening now in the eurozone still consists of a major financial and political threat for the United States. A very potential eurozone collapse is going to unleash forces able to demolish all the American economy's achievements over the last two years by putting the country back to 2008. The recurrence of this crisis though will be harder with its repercussions hurting not only the banking system but the overall real economy in the United States. As long as the Europeans leaders cannot find a common ground solution on the problems cursing the eurozone, President Obama has to compromise with the idea that the upcoming presidential elections will take place under rather adverse conditions in contrast with what was initially expected.
What is seen as an effect of the current eurozone's meltdown on the American economy is the unprecedented deterioration of some of the most crucial financial figures like growth, unemployment and consumer spending giving the image of a general destabilization of the already fragile country's economy. However, the majority of average American voters are not familiar with what experts, analysts and economists say -- which is that the United States and Europe are financially interconnected. Even though the White House and all of the U.S. Government's executives do their best to spread the message to people that the dark clouds upon their economy are coming directly from Europe, most Americans will vote on November to judge not the Europeans', but President Obama's, economic policy, even though that last one has no room to get better as long as the eurozone's stalemate exists. Furthermore, the Republican champ's opposition to any further support of the Fed's action in boosting the American economy, as well as to any more active and deeper financial U.S.s involvement by providing more money to the IMF's lending capacity, has, as a result, President Obama trapped into two very different political realities that are uncontrolled by him. The first one is the internal political reality described above and consisting of the voters' and Republicans' behavior. The second one is the exterior political reality formed by the European leaders' inefficiency to contain a crisis like this endangering the American and global economy.
What we have witnessed thus far is the unambiguous support given by the U.S. president generally to Europe and especially to Greece urging Chancellor Merkel and other European leaders to take solid and rapid actions against the financial turmoil in the continent. The question is: Are President Obama's spoken urges sufficient for us to believe that this is all about what the United States should or can do to help Europe? My answer is no and the reason is that Europe needs guidance right now since its lack of deep institutionalization, integration, and federalization worsen its inability to delineate an overall plan to exit this crisis. And such a guidance on how the eurozone can be converted from a union with no federalized consistency into a real monetary, fiscal and banking federation, can be provided only from the United States. If President Obama desires to actually see the eurozone -- and to some extent his country's economy -- to survive this crisis, he should undertake the responsibility of doing something further than verbal recommendations to Europe. The American diplomacy has to show now its determination to push Europe -- and especially Germany -- to those decisions that seem inevitable towards rescuing the eurozone. Otherwise, the common currency's collapse will not only be a European failure but, also, an American one. Unless the United States invest financially and politically in Europe, it will have to count losses on every level: the economy, the people, and President Obama.
Follow Thanos Dimadis on Twitter: www.twitter.com/thanosdimadis