WASHINGTON: Barack Obama turns his focus Thursday to a crisis that could conceivably end his presidency, but over which he has little control, welcoming Italy's Prime Minister Mario Monti for Europe debt talks.
The White House, cheered by signs the US economy is speeding up and is at last creating more jobs as Obama prepares to seek a second term in November, has been watching Europe's struggles to end its debt nightmare with alarm.
Any scenario involving defaults by European economies or a break-up of the euro could draw in the US finance sector, hammer American exports, slow American growth and job creation, and hamper Obama's political prospects.
The White House said Thursday's talks will focus on "comprehensive steps" Italy is taking to restore market confidence and reinvigorate its economy as well as the prospect of "an expansion of Europe's financial firewall."
The Oval Office meeting will take place with the focus of Europe's turmoil on Greece, after the country's leaders did a last minute deal on austerity cuts to secure a new eurozone bailout. Angry unions, though, vowed more strikes.
Monti will meet Obama two months after European leaders agreed to a budget compact designed to reassure markets that a profligate era of debt and rash fiscal indiscipline is over.
Since taking power in mid-November, Monti has pushed through a draconian austerity plan and is now hoping to perform a massive liberalization program and reforms of the job market in the hope of future prosperity.
In exchange, the Italian premier wants EU partners to reinforce the eurozone's rescue funds and will be looking for a strong endorsement of his methods from Obama and for support when the US leader speaks to counterparts in France and Germany.
But he said Thursday that his country was not in need of a bailout like those for Greece, Ireland and Portugal.
"Italy is not at a point where it needs financial assistance, but it needs better governance," Monti told an audience at the Peterson Institute for International Economics, adding that the "IMF is playing a key and very constructive role in the euro area."
"I think it is right when it says that Europe should do its part of the job and build a firewall that is high enough" to stall contagion from the most troubled eurozone countries.
Monti has said the eurozone crisis may be moving towards a resolution but also warned that it has tested the continent's cohesion, after reviving prejudices between the prosperous north and poor south.
Monti's visit represents something of a new beginning for US-Italy relations, after Obama clearly attempted to keep personal interaction with his scandal-tainted predecessor Silvio Berlusconi to a minimum.
Monti is seen as a sober, professional bureaucratic brand of leader who may be just the man to restore outside confidence in Italy's chaotic economic governance.
US Secretary of State Hillary Clinton Thursday praised his leadership as she met with her Italian counterpart Giulio Terzi di Sant'Agata.
"I want to underscore how confident we are in Italy, in Italy's future, in the extraordinary commitment that Prime Minister Monti and his government are bringing to the challenges confronting the Italian people," Clinton said.
The White House has watched Europe's debt turmoil with disquiet and some frustration at its failure to show political will to solve it more quickly, given the impact it could have on Obama's prospects and the US economy.
In December, when the fiscal compact was agreed, officials praised it as a step in the right direction towards building a firewall but warned a European show of force and will was still needed.
Obama's administration also faces ferocious opposition to any suggestion that the United States would help provide funds, even through the IMF, to back-stop Europe.
The US leader also hopes to use Thursday's talks to talk about wider geopolitical issues, at a time when the United States and Europe are piling intense pressure on Iran to halt its nuclear program.
Obama also wants to prepare the way for G8 and G20 summits that he will host in Chicago in May.
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