6 - Tuesday, February 21, 2012
The Michigan Daily - michigandaily.com
EU ministers work through.
night on Greek bailout plan
H AND MAXI MOMUSIELIK/AP
Police hold back relatives of inmates outside Apodaca correctional state facility on the outskirts of Monterrey, Mexico as
they try to get past the gates on Sunday.
In-mate slaughter sheds light
on Mexican prison problems
Guards helped
inmates escape,
44 killed in riot
Sunday
MONTERREY, Mexico - Thee
revelation that guards likely
helped members of the violent
Zetas drug cartel slaughter 44
rival inmates and break out of
a northern Mexico jail throws
new attention on the enormous
corruption inside the country's
overcrowded, underfunded
prisons.
The top officials and as many
as 18 guards at the Apodaca
prison may have helped 30 Zetas
escape during the confusion of a
riot early Sunday in which other
Zetas fatally bludgeoned and
knifed 44 members of the rival
Gulf cartel, Nuevo Leon Gov.
Rodrigo Medina said yesterday.
The massacre in this north-
ern state was one of the worst
prison killings in Mexico in
at least a quarter-century and
exposed another weak insti-
tution that President Felipe
Calderon is relying on to fight
his drug war.
Mexico has only six federal
prisons, and so sends many of its
dangerous cartel suspects and
inmates to ill-prepared, over-
crowded state penitentiaries.
Drug trafficking, weapons pos-
session and money laundering
are all considered federal crimes
in Mexico.
"The Mexican prison sys-
tem has collapsed," said Raul
Benitez, a professor at Mexico's
National Autonomous Univer-
sity who studies security issues.
"The prisons in some states are
controlled by organized crime."
An increase in organized
crime, extortion, drug traffick-
ing and kidnapping has swelled
Mexico's prison population
almost 50 percent since 2000.
But the government has built
no new federal prisons since
Calderon launched an offensive
against drug cartels when he
took office in late 2006, leaving
existing jails overcrowded.
Calderon's administration
has renovated three existing
state prisons to use as federal
lockups.
Built to hold about 185,000
inmates, the prison system
nationwide now holds more
than 45,000 above that capac-
ity, according to figures from the
National Public Safety System.
Of the 47,000 federal inmates
in the country, about 29,000 are
held in state prisons. That has
drawn complaints from Medina
and other state governors, who
say their jails aren't equipped to
hold members of powerful and
highly organized drug cartels.
The federal governmentcoun-
ters that none of the escapes or
mass killings have occurred at
federal lockups, and it cites cor-
ruption on the state level, not
overcrowding, as the main cause
of the deaths and escapes.
"The constant element has
been corruption in the control
processes" at the prisons, said
Patricio Patino, assitant secre-
tary for the peniteniary system.
Prison employees say guards
are underpaid, making them
more likely to take bribes. And
even honest guards are vulner-
able to coercion: Many live in
neighborhoods where street
gangs and drug cartels are
active, making it easy to target
their families with threats.
The same can be said for
Mexico's municipal police
forces, another weak flank in
Calderon's attack on organized
crime. Thousands of local offi-
cers - often, entire forces at a
time - have been fired, detained
or placed under investigation for
aiding drug gangs.
"Yesterday, Apodaca, tomor-
row, any other (prison)," col-
umnist Carlos Puig wrote in the
newspaper Milenio.
Eurozonesaid French Finance Minister
Francois Baroin. "Greece knows
goverments hope what it has to do, and we'll watch
over itcontinually.We also know
to reach agreement what we have to do."
But the finance ministers
on debt crisis were also negotiating on several
fronts, trying to move Greece's
BRUSSELS - Eurozone gov- other creditors to increase their
ernments worked into the night commitments. Greek Prime
yesterday, hoping to agree on a Minister Lucas Papademos
long-awaited rescue package for rushed to Brussels to back up his
Greece that would save it from finance chief, Evangelos Veni-
a potentially calamitous bank- zelos, in talks with the IMF, the
ruptcy next month, but several European Central Bank and rep-
key points of division remained, resentatives of private holders of
senior officials said. Greek debt.
Finance ministers meeting The goal is to bring Greece's
in Brussels yesterday were still debt down to around 120 per-
wrangling over how to reduce cent of gross domestic product
Greece's debt load further and by 2020 - the maximum the
impose even tighter control IMF sees as sustainable. At the
over the country's spending, and moment, the country's debt load
negotiations were expected to stands at more than 160 percent.
stretch late into the night. Rich Last week, a new report pre-
countries like Germany and the pared by the European Com-
Netherlands and the Interna- mission, the ECB and the IMF
tional Monetary Fund want to concluded that the new bail-
be sure that Athens can eventu- out, Greek spending cuts, and
ally survive without aid. a planned euro100 billion debt
But after months of delays, relief from private investors
time for Greece is running out. would still leave Greece's debt at
The country needs to secure almost 129 percent of economic
the euro130 billion ($170 billion) output by the end of the decade.
bailout so it can move ahead Ministers were exploring sev-
with a related eurol00 billion eral options to close that gap, but
($130 billion) debt relief deal as talks dragged yesterday, no
with private investors. That deal final solution appeared immi-
needs to be in place quickly if nent.
Athens is to avoid a disorderly AGreek official saidyesterday
default on a bond repayment on morning that there seemed to be
March 20. agreement on further reducing
"I am of the opinion that today the interest rate on Greece's first,
we have to deliver, because we euro110 billion bailout as well as
don't have any more time," Jean- having national central banks in
Claude Juncker, the prime min- the eurozone, which also hold
ister of Luxembourg who also some Greek bonds, participate in
chairs the meetings of eurozone the debt relief. The official was
finance ministers, said as he speaking on condition of ano-
arrived in Brussels. nymity because the talks were
An uncontrolled bankruptcy confidential.
would likely force Greece to However, other officials
leave the 17-country currency questioned the participation of
union and return to its old cur- national central banks, as well
rency, the drachma, further as whether the ECB would be
shaking its already beaten econ- willing to transfer profits from
omy and creating uncertainty its Greek bond holdings back to
across Europe. Athens.
Heading into the meeting ear- On the sidelines of the finance
lier yesterday, ministers were ministers' meeting, Venizelos
optimistic that a deal could be headed into a new round of talks
reached. with representatives of Greece's
"We now have all of the ele- private bondholders - mostly
ments to achieve an agreement," banks and investment funds - to
explore whether they would be
willing to accept further losses.
A current plan foresees pri-
vate creditors swapping their old
Greek bonds for new ones with
half the face value, lower inter-
est rates and much longer repay-
ment periods.
But now some countries are
pushing for bondholders to also
give up on an accrued interest
payment of around euro5.5 bil-
lion on their old bonds, a demand
that could further discourage
investors from signing up to the
debt swap.
Amid the ever-changing
mood over the country's rescue,
some frustration was setting in
among the Greeks.
"Greece comes into today's
Eurogroup meeting having ful-
filled allithe requirements for the
approval of the new program,"
Venizelos said. "For Greeks,
this is a matter of national dig-
nity and a national strategic
choice and no other integrated
and responsible choice can be
opposed to it."
The Greek parliament has
faced down violent protests to
approve the austerity measures
demanded by the eurozone. Its
main political leaders have com-
mitted in writing to uphold the
bailout terms even after general
elections in April. Yesterday in
Athens, the government intro-
duced in parliament anothertwo
pieces of emergency legislation
that would introduce austerity
measures including wage and
pension cuts.
Despite Athens' efforts, how-
ever, some countries have indi-
cated their patience with Greece
was growing short.
"We've seen that Greece time
and time again fails to satisfy the
conditions that the internation-
al community makes. ... In the
Netherlands, it really is an issue
that you have to lend money to a
country that for the umpteenth
time hasn't held itself to its
agreements," said Jan Kees de
Jager, the finance minister from
the Netherlands, which has been
especially hard on Greece. "So
it's indeed essential to me, and
also the Dutch government, that
we have control over the money
that we're going to lend."
To that end, Greece is
expected to be forced to set up
a separate account that would
ensure it services its debt.
This escrow account would
give legal priority to debt and
interest payments over pay-
ing for government services.
That would maintain pressure
on Greece to stick to promised
austerity and reform measures
and spare the eurozone the risk
of a destabilizing default.
The escrow account would,
however, be an unprecedent-
ed intrusion into a sovereign
state's fiscal affairs and could
ultimately see Greece forced to
pay interest on its debt before
paying salaries to teachers and
doctors.
In addition, Greece's inter-
national creditors would sta-
tion permanent representatives
in Athens to monitor the coun-
try's progress.
Another issue under discus-
sion is how much the IMF will
contribute to the new rescue.
The fund has provided one-
third of the bailouts for Ireland
and Portugal and Greece's first
rescue package.
"The indication is that the
figure will be rather low," a
European Union official said,
adding however that a final
decision from the fund's board
is still outstanding. The official
was speaking on condition of
anonymity because talks were
not yet concluded.
Some worry that more
austerity could exacerbate
Greece's problems by putting a
stranglehold on growth. Prime
Ministers from a dozen Euro-
pean countries - including the
U.K., Italy and the Netherlands
- wrote a letter yesterday to EU
President Herman Van Rom-
puy and Commission President
Jose ManuelBarroso callingfor
growth across the bloc.
"The crisis we are facing is
also a crisis of growth," the let-
ter said. "It is now time to show
leadership and take bold deci-
sions which will deliver results
that our people are demand-
ing."
RELEASE DATE-Tuesday, February 21, 2012
Los Angeles Times Daily Crossword Puzzle
Edited by Rich Norris and Joyce Nichols Lewis
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