Merkel scrapes win on Greek bailout, rebels grow

Mon Feb 27, 2012 6:41pm EST
 
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By Stephen Brown and Hans-Edzard Busemann

BERLIN (Reuters) - German Chancellor Angela Merkel scraped through a parliamentary vote endorsing a second bailout for Greece on Monday but faced a growing backbench revolt against pouring in more money in support of the euro zone.

The comfortable 496-90 victory, with five abstentions, was inflated by centre-left opposition support, but only 304 of Merkel's 330 centre-right coalition lawmakers backed the motion.

The Bundestag lower house voted shortly before Standard & Poor's cut Greece's long-term credit rating to "selective default," becoming the second agency to downgrade Athens after it announced a bond swap plan to lighten its debt burden.

Seventeen coalition rebels voted "No" this time, compared with 13 who defied Merkel last September in a vote to boost the euro zone rescue fund.

Analysts said the outcome could weaken her politically and make it harder for her to agree to strengthen Europe's financial defenses just when international pressure on Germany is rising.

"Merkel is losing her powers to convince, and the members of the Bundestag are losing their belief that everything will go according to plan," said Gero Neugebauer, a politics professor at Berlin's Free University.

The world's leading economies in the G20 piled pressure on Berlin at the weekend to drop its opposition to a bigger European bailout fund, telling Europe it must put up extra money if it wanted more help from other countries.

European Commission President Jose Manuel Barroso added his voice on Monday, saying he expected a decision on strengthening the euro zone's financial firewall during March, although not at an EU summit on Thursday and Friday.   Continued...

 
German Chancellor Angela Merkel (R) talks with Finance Minister Wolfgang Schaeuble during a debate before a parliamentary vote on a Greek bailout package in the Bundestag, the lower house of parliament, in Berlin , February 27, 2012.  REUTERS/Thomas Peter