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In Euro crisis, Obama tries to build on a rapport with Merkel

By Mark Landler and Nicholas Kulish / New York Times

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LAST UPDATED: 09:08 p.m. HST, Jun 16, 2012



WASHINGTON » At the end of a summit meeting at Camp David last month, as the other world leaders were heading for their helicopters, President Barack Obama did what has become a habit during his years in the White House: He made time for an informal but deadly serious talk with Chancellor Angela Merkel of Germany.

Sitting at a picnic table outside his cabin as the sun set behind the Maryland mountains, the two leaders chewed over the meeting — one in which Merkel found herself under heavy pressure to respond more aggressively to Europe's financial crisis.

"You feel OK with where we are?" Obama asked, according to one of his aides.

Merkel assured him that she did not feel overwhelmed by the demands of her fellow leaders, according to officials. Left unsaid was that Germany was still not ready to take the wrenching steps that Obama and others believe are needed to stop Europe's debt woes from cascading into a global economic storm.

A collapse of the euro could derail America's fragile recovery and doom Obama's re-election hopes. So the president finds himself in the strange position of having forged a relationship with Merkel that is perhaps the best he has with any foreign leader, but that has not yet resulted in the chancellor doing what Obama thinks must be done in Europe: a U.S.-style bailout and fiscal stimulus.

Obama and Merkel will meet again Monday at a Group of 20 summit meeting in Mexico with the stakes for Europe even higher than they were last month. With Greece holding elections Sunday that could precipitate its exit from the European currency union — the nightmare feared by the financial markets — Obama may be running out of time to make his case.

And there is no indication Merkel is any more inclined to heed it. In a speech to the German Parliament on Thursday, she said the world should not expect Berlin to be Europe's savior, rejecting calls to create euro bonds to share the debt burden of the Mediterranean countries.

However acute the tensions, U.S. and German officials insist they have not poisoned the dialogue between the two leaders — carried out over 12 phone calls, two video conferences and three face-to-face meetings this year alone. In each exchange, their aides say, Merkel and Obama pick up where they left off, speaking with the brisk logic and lack of small talk one might expect from a physicist and a law professor.

"He has total respect for her," said Michael Froman, a deputy national security adviser who took part in the Camp David session. "She's very Midwestern in her own way: She tells him exactly what she can and can't do, will or won't do."

They also, their aides say, share a kinship of another kind.

"They're both kind of outsiders: an African-American from Hawaii and a woman from East Germany," said Benjamin J. Rhodes, deputy national security adviser for strategic communications.

That makes their relationship very different than those the president has built with other foreign leaders — from the fiery back-and-forth he has had with Prime Minister Recep Tayyip Erdogan of Turkey to the earnest discussions about high school education with President Lee Myung-bak of South Korea. Former President Nicolas Sarkozy of France told people he found Obama "cold, cold, cold." For Merkel, a little chill might be the right temperature for debating issues like bank recapitalization, debt sharing and fiscal integration.

It is not that Obama and Merkel have failed to show each other warmth. The high point came last year when he awarded her the Presidential Medal of Freedom. At a state dinner in the Rose Garden, she was served apple strudel and serenaded under the stars by James Taylor. His song: "You've Got a Friend."

Merkel had eschewed her practical pantsuit for a black evening gown. The two toasted each other — she with red wine, he with white. At the end of the evening, an official said, she turned to her host.

"The next time you come to Germany," a beaming Merkel said, "you can speak at any gate you want."

It was a reference to their awkward start in July 2008, when Obama, then a candidate for president seeking to bolster his foreign policy credentials, sought to deliver a speech before the Brandenburg Gate in Berlin. Merkel let it be known that she frowned on his plan to use a site so freighted with historic significance for Germans. Obama's aides moved the speech.

The contretemps made headlines, but their private meeting at the Chancellery in Berlin went better. Merkel was surprised, aides said, by how far the young senator was from the political celebrity portrayed in German media. Merkel found Obama to be, as she is, a detail-oriented wonk.

But the relationship was still not warm by any stretch, and at a meeting in Dresden in June 2009, Obama went out of his way to chastise the press for speculating about disharmony.

From Dresden, Obama and Merkel traveled with Holocaust survivor Elie Wiesel to Buchenwald, the Nazi concentration camp. The trip was something of a turning point. Rather than treating the chancellor like the representative of a guilty nation, Obama was solicitous, even a little protective about the jostling photographers.

For Merkel, the president's cultivation carries a political bonus with a German public that is still enamored of him.

"For the head of the German government to be received so well in America has a very positive impact back home," said Gerd Langguth, a political scientist at the University of Bonn and a biographer of Merkel.

Their mutual high regard and constructive working relationship does not mask fundamental differences between German and U.S. economic philosophies, and in their respective remedies for solving Europe's debt crisis. The United States is pushing Germany to accept some form of debt sharing, which many Germans regard as anathema, and to embrace a growth oriented economic policy rather than relentless austerity.

Merkel must also contend with a German public that is hostile to bailing out Greece, let alone Italy or Spain. Obama, his advisers say, is keenly attuned to her domestic political constraints.

Jackson Janes, executive director of the American Institute for Contemporary German Studies, said: "There's a cold logic to her position. She's saying, ‘Look, Mr. President, I have some problems that I need to respond to that don't correspond to your need to be re-elected."'

For all their disagreements over Europe, the two have "exactly the same view" on other thorny issues, from China and Russia to Iran and Afghanistan, said Klaus Scharioth, the German ambassador to Washington until last year.

U.S. officials point out that Merkel is the only major European leader left from when Obama took office. At times, they can appear like an old couple ribbing each other about their idiosyncrasies. Walking through the White House together on a visit she made after the Buchenwald trip, Obama joked with the often-dour Merkel about her re-election campaign.

"Ah, you've already won," a wireless television microphone picked up Obama telling her. "I don't know what you always worry about."






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