The greatest risk to her re-election bid, pollsters and analysts say, is a dramatic worsening of Europe's debt crisis — such as Greece exiting the eurozone, or a Greek debt write-off costing billions in German taxpayer money.
[...] Merkel's hard-nosed approach to Europe's debt crisis has bolstered her popularity at home.
Many economists say that Greece's debt burden — forecast to reach some 190 percent of gross domestic product next year — can only be managed by writing off more government loans.
Many private economists call those projections wishful thinking, saying they are based on overly optimistic budget and growth assumptions — especially with the overall eurozone now in recession.
Recent German public opinion surveys consistently show Merkel's conservative bloc as the country's strongest party, though her junior coalition partners, the pro-business Free Democrats, are struggling, possibly jeopardizing her ability to form a new coalition government.
In rejecting of a debt write-off, the government "shies away from telling its people the truth and clearly say that keeping Greece in the eurozone does not only make sense but will also have a cost," she added.
[...] Merkel's hard-nosed approach to Europe's debt crisis has bolstered her popularity at home.
Many economists say that Greece's debt burden — forecast to reach some 190 percent of gross domestic product next year — can only be managed by writing off more government loans.
Many private economists call those projections wishful thinking, saying they are based on overly optimistic budget and growth assumptions — especially with the overall eurozone now in recession.
Recent German public opinion surveys consistently show Merkel's conservative bloc as the country's strongest party, though her junior coalition partners, the pro-business Free Democrats, are struggling, possibly jeopardizing her ability to form a new coalition government.
In rejecting of a debt write-off, the government "shies away from telling its people the truth and clearly say that keeping Greece in the eurozone does not only make sense but will also have a cost," she added.
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