it is the german and french banks which are right up to their necks in greek that. i think there is certainly a case now that this is a eurozone-wide problem, and has the potential to become a global problem. it concerns all the economies in the eurozone. if there is existential doubt about the currency itself, everyone will suffer. >> will this be a turning point in the eurozone crisis? >> it could, but i think it will be difficult to see. will have to see in days and weeks and months. what will help is that ireland and portugal, which are not in as bad a situation, will get much better official lending. this is what they should have done more than a year ago. it might well help ireland and portugal. whether it is a turning point for greece itself is doubtful. >> thank you very much indeed. in libya, and rebel commanders in the country's western mountains have told the bbc they are taking steps to deal with looting, despite dismissing it as a small problem. commanders of the opposition forces deny human rights abuses and say they are doing everything they can to es

the greek situation is a al tragedy. greek cannot borrow money. this country is not in bad shape at all. or but we have a politically geneted crisis. there is no real rean to have a debt limitation anyway. what congress and the president shouldo is tax spending, taxes and spending and the economy together will produce a budget deficit or surplus. the democrats, i think were rightly worried a little bit about how much president obama was willing to give away in terms of slicing spending on programs they hold dear. but it turned out the republicans are unwilling to accept anything. and john boehner who had promised repeatedly that the debt ceiling would be raised, apparently now is backing away from that. it looks like he's just caved in to the right wing members of his caucus. >> rose: he has released this statement. during these discussions as in my earlier discussions became evident that the white house has simply not serious about ending the spding binge thais destroying jobs and endangeri our children's future. a deal was never reached and neve

the greeks have done a lot. the greeks have felt a lot of pain. but, unfortunately, they don't have many other good choice. >> warner: all right, we have to leave it there. thank you both very much, simon johnson mark weisbrot. >> brown: still to come on the "newshour": white house chief of staff bill daley; a hospital targeting medical mistakes; the buying-fever over social media sites and labor protests in china. but first, the other news of the day. here's hari sreenivasan. >> sreenivasan: the news from greece helped reassure wall street and stocks gained ground for a fourth day. the dow jones industrial average was up nearly 153 points to close at 12,414. the nasdaq rose 33 points to close above 2,773. u.s. forces in iraq have had their deadliest month in two years. officials announced today that three american soldiers were killed wednesday in the south near the border with iran. that made 15 this month, the most since june of 2009. shi-ite militias in iraq have stepped up attacks on u.s. forces. the militias oppose any move to have the troop

tonight, leaders announced a second rescue package for the greek economy. the very stability of the euro is being called into question. >> 10 years ago, the euro have been launched into a fanfare of celebration. leaders came up with a historic package designed to draw a line under the greek debt crisis. the french president and the german chancellor pushed through a rescue plan that amounts to nearly 110 billion. it is intended to reduce the debt burden. >> is not someone waving a magic wands, but helping greece return to stability to trigger a return to controllable that. >> van that had shot up to 350 billion despite being bailed out last year. leaders insisted that what they were doing for greece was a one off. what is in the deal? interest will be reduced. private investors will take over some of the costs of the bailout. and there will be a european monetary fund to help banks or countries in trouble. the french president stressed that in order for this to work, the debts have to come down what we are doing for greece we will do for no other country. w

the greeks don't like the austerty, and the concern is something bigger. when the default actually happens, it will not be like lehman brothers as some are saying. countries have defaulted again and again and again. it is not as unusual as what happened with lehman brothers. but the europeans could do anything. >> in a better scenario, you will get the risk over with. >> susie: another thing worrying investors is the whole job situation. we have the june employment report coming out friday. the consensus is 115,000 jobs were created last month. does that sound about right for you? how does the job market look to you these days? >> well, it soublds about right. susie, if you're looking for a job t feels like recession, because unemployment is really high. we have just not come out of it. we'd like to be seeing 200,000. 300,000 jobs created every month for a couple of years to really start pulling us out of this. i do think the second half of the year ought to be bettered the affects go by. >> household debt. and government debt. there's an overhang on the e

just days before, acting as france's finance minister, lagarde was arguing for a greek bailout. but today, she declined to offer an opinion on greece one way or the other. >> so she basically did not take the opportunity to repeat what is still officially the position of the i.m.f., which is that greece will not default, which i would take to suggesting that she has already put on a different set of eyeglasses and is perhaps somewhat more flexible on this issue than she was before. >> reporter: greece has failed to meet the economic targets set as a condition for i.m.f. loans. former i.m.f. economist eswar prasad says a decision by lagarde to give greece more money will raise more questions in emerging markets about whether the i.m.f. plays fair. >> there is a perceptible sense among the emerging markets that they would never have been able to get away with what europe is getting away with. in this case, we see that there isn't an obvious path for greece to actually meet the conditions, and yet it continues to get money. >> reporter: to address those emerging market concerns, la

, possibly italian debt. -- greek debt, possibly italian debt. >> eight banks have failed the test. the five from spain, to from greece, and an austrian bank. they will be working with their governments over the weekend on plans to strengthen their balance sheets. all four u.k. banks were given a clean bill of health. investors will be pouring over the huge amounts of details today to run their own stress test and they will give their verdict on monday morning when europe's markets are open for business. >> europe is hardly alone in trying to get their financial house in order. today, president obama said time is running out to reach a deal and cut the deficit and debt ceiling. he stressed the consequences for all americans if an agreement is not reached before the looming august 2 deadline. >> congress has run up the credit card and we have an obligation to pay our bills. if we do not, we could have a whole set of adverse consequences. we could end up with a situation, for example, where interest rates rise for everybody throughout the country, affectively a tax increase on everybo

we're not going to work to age 70 so the greek cans retire at 58. >> rose: what role does sarkozy play? >> well, it'svery interesting because, you know, quite apart from the entertainment value which he always has because, as you know, historically in the european project there was the german engine and the french driver. >> rose: right. >> and what's happened now is that the german engine has, so to speak, got up into the driver's seat and actually sarkozy and the french are running along behind trying to keep the show on the road and trying to influence it. >> rose: from afar, how do you see our political system grappling with a debt ceiling-- so far unsuccessfully? >> you know, i come back to the united states every year for an extended period and so i see this country in kind of time-lapse photography. >> rose: right. >> snapshots every year and it's really quite shocking to see the gradual relative decline, starting with the elementary fact of the decline in infrastructure. i mean roads, public transport, public goods. that a simple point. i would say that... and i say this in jes

isn't the italian economy about six times the size of the greek economy? >> will, in a way it is. but, you know, i think we're also have to start to define what default is because there is lots of confusion. the markets are very volatile and investors get worried. so, now, for example as part of the negotiations germany and france would like to see the banks take a bit of a cut in their positions with greece which is a fair distribution of a shared cost. now, standard & poor's and moody's come out and says "well, if you do that, that is a default." and so people get increasingly worried. so i think we have to be very attentive at what kind of terms we use. i don't think that italy is going to default. the european central bank is resisting a technical default of greece. so we'll have to see how that goes. but this situation... the situations are very different. italy has a much stronger and better economy than greece. >> suarez: well, mario, other count rise in europe have about a trillion dollars exposure to italian paper. even american banks have almost $300 billion. is italy to

two huge economies being rattled by the greek debt crisis. they gathered, not to officially discuss in italy. there used to be an assumption that this bank a country uses a euro, when lending to that country is safe. they are worried that they might not care about all of the money that they lent to greece. they might be rethinking the way they lend to countries that are heavily in debt. >> sorting of greece is crucial. finance minister say that they have now agreed to work quickly on a second bailout for greece. they said that they would increase the size of the rescue mission -- rescue mechanism currently in place. >> we have made significant progress yesterday. i am certain that shortly we will be able to present the concrete proposals so that we cannot take concrete decisions. >> that is an admission of how much working to be done. there are serious disagreements within europe about how to help greece. other countries are being dragged into the process. >> i and joined by the economic international editor. portugal, ireland, greece, spain,

the great crisis has now changed that -- greek crisis has now changed that and they are rethinking the terms by which they lent to other countries that are heavily in debt. that is why interest rates to italy and other countries are currently going up. sorting out greece is crucial. finance ministers have agreed to work quickly on a second bailout for greece. they said it would increase the size of the rest the mechanism currently in place -- they would increase the size of the rescue mechanism currently in place and make it cheaper for them to pay off their debt. >> we have made significant progress yesterday. i am certain that, shortly, we will be able to present a concrete proposal so that the ministers can take the concrete decisions on this. >> that is an admission of how much work still needs to be done. there are serious disagreements within europe about how to help greece. all the while, other countries are getting dragged into the crisis. matthew price, bbc news, brussels. >> for more on the economic situation, i am joined by an economist. it seems like, every week, another co

. >> they still do not fully reflect what the market is saying today about the worst case for greek debt and possibly italian debt. they are better and tougher. the question is whether they are tough enough. >> eight banks have failed the test. five are from spain, two are from greece. there's also an austrian bank. they will be working with the government over the weekend on plans to strengthen their balance sheets. all four u.k. banks were given a clean bill of health. investors will be going over the details released today to run their own stress tests. they will give their verdict on monday morning when european markets open for business. >> europe is hardly alone in trying to get their financial house in order. today president obama said that time was running out to reach a deal on cutting deficits and raising the debt ceiling. he stressed the consequences for all americans if an agreement is not reached before the august 2 deadline. >> congress has run up the credit card. we now have an obligation to pay our bills. if we do not, we could have a whole set of adverse consequences. we

it seems now we will not have an ultimate decision on greek death. >> if the banks to except losses, it will unsettle markets further. another thing is italy. if the eurozone struggles to solve the greece's problems, they may debate how italy can handle its debt, and italy is too vague to rescue. -- too vagubig to rescue. >> an attack on the catholic church for encouraging increased to not report abuse to the police. he says it shows dysfunctional as some, elitism, and narcissism. he says relations between the church and state of ireland could never be the same again. in cuba, he is called bin laden of the americas, but the former cia operatives maintains he has never been convicted of a terrorist attack. we went to miami to meet him. >> tourism is vital to keeping a shoe box costs fragile economy on its feet, but this was an industry that was almost destroyed -- to keep big cuba's .ragile economy on its feet this hotel is just one of those hit, and this is the person who bombed it. he is serving a 30-year prison sentence. he said he was given orders by a man who the cubans call bin

in rome no sense of a greek-style crises just yet. however this city where european economic integration began with the 1957 treaty could yet be decided of its ultimate failure. there are politics putting together a package of spending cuts, particularly after a public spat between the italian prime minister and his own finance minister. >> of course the markets are reacting because they were nervous before and now they're getting much more nervous because of such talks of italy. >> current bailout bonds could not afford italy. they have a national debt worth more than the size of its stagnant economy. today's meeting was actually meant to finally sort out grief, inching toward accepting the form of greek debt default according to one minister here. the problem is the president for the like of italy and spain. >> the current state of the crises is a severely intertwined combination of the debt crises and banking sector, and we cannot solve one without solving the other. we need to solve both. >> simply put, in italy can't put a lid on

. >> dominique strauss-kahn was forced to resign as head of the imf of the greek economy was in crisis. his ambition to be a french presidential contender could be revived. it could be the socialist candidate before the deadline expires. >> the people here will have for him greater admiration than before because he had shown a great quality of courage and dignity. >> it has been a turbulent six weeks for dominique strauss- kahn. from top finance official to a criminal defendant. he was encouraged by the facts against him. >> we are outside the courthouse now in new york. his lawyers have said that he will not be making any statements until he is in france and fully cleared. is that what they expect will happen now? >> they are so -- they are certainly hoping for that. the prosecution, they are the people that try the case. you'd expect the defense to say that the credibility of the made making the accusations is in question but for the prosecutors who are relying on her and brought this case, for them to be raising the question publicly, and for many legal experts, they think is a ques

i've been doing afghanistan and bin laden and the greek crisis. >> the president says he wants to get working, wants us to get working. i cannot think of a better way than to have him come over today. ng.are waiting sen >> senate minority leader mitch mcconnell. for all the kids were outraged by the president's remarks. -- republicans were outraged by the president's remarks. but harry reid was listening. what you make of the president's performance on wednesday, mark? >> i think the president recognizes two things. over the last two years, democrats lost to the debate on their major initiatives, economic recovery and health care. they don't want to run the risk this time. they have to lay out what the consequences are, the recklessness and irresponsibility of even entertaining the possibility of letting this country defaults on its obligations. >> evan, what do you make of it? >> you cannot be partisan about this. at least he is showing some energy. but he has got to be an arm twister behind the scenes, and he is not really lyndon johnson. this is serious now. this is his moment of l

the greek debt crisis could flare up again. and leaders in washington might miscalculate, making a mistake on the debt limit that scares markets and tanks growth. and don't look for much help from the federal reserve for the rest of the year. after q.e.-1 and q.e.-2, we are now in the world of q-e none. >> so now we really are kind of on cruise control and we are hoping the private sector is up for it. we're hoping the abatement in these headwinds that the fed chairman talks about will be enough to allow the economy to move forward. >> reporter: so americans are likely to return from vacation to find an economy that is picking up speed, but not lighting up the sky. darren gersh, "nightly business report," washington. >> tom: here are the stories in tonight's n.b.r. newswheel: corn prices hit their lowest level since december, falling almost 4% to just under $6 a bushel. the move came one day after the ag department said u.s. farmers planted one of their largest crops in decades. minnesota is closed for business. a state governm

and other private investors will contribute $53 billion to the rescue package by either rolling over greek debt, swapping it for new bonds with lower interest rates, or selling the bonds back to greece at a low price. >> susie: a year ago today, wall street got a new rulebook. president obama signed the dodd- frank financial reform and consumer protection act into law. the goal of the massive 2,300- page legislation was to stop another financial meltdown like the one we saw in 2008, before it happened. but a year later, the vast majority of changes, including structural changes to how big banks do business, are yet to come. nearly half of the 243 new rules mandated by the law were supposed to be finalized by now, but regulators have completed fewer than 50. testifying before a senate committee today, federal reserve chairman ben bernanke says implementing the new rules will take time. >> a full transition to the new system will require much more work by both the public and private sectors and, no doubt, we will learn lessons along the way. >> susie: one new process is in place-- the consum

the greek parliament has okayed a tough new austerity plan. now, billions of dollars in loans can start flowing in from the european union and the international monetary fund. meanwhile, hundreds of thousands of public workers took to the streets in britain to protest pension cuts. their union is warning the one- day strike could be the beginning of a wave of strikes. still ahead, how best to invest over the next decade, especially with stocks sitting close to where they were ten years ago. new claims for jobless benefits fell by a thousand in the past week to 428,000. they haven't dipped below the 400,000 mark since april. and with many worried about a summer soft-patch for the economy, former president bill clinton is trying to boost job creation. this week, he's in chicago for his annual clinton global initiative. the goal-- bringing together leaders from businesses, non-profits and government to brainstorm on how to get america back to work. former michigan governor jennifer granholm is one of those leaders at the event. she says businesse

i've been doing afghanistan and bin laden and the greek crisis. you stay here! let's get it done. >> but, mr. obama himself has spent considerable time outside the nation's capital. obama was in brazil on march 19 when he announced his authorization of "limited military action" in libya. for that matter, he has been away from washington for a large part of the this 2 1/2 years as president. according to figures compiled at the end of 2010 by cbs reporter mark knoller, obama's first 23 months in office saw 70 days on foreign trips and 58 days on vacation trips. he's gambled at a pace to present himself as a statesman. above the scramble of something disagreeable called washington. >>> question, with regard to obama's leadership on domestic issues, what hasn't emerges from his issue, what pattern e pledges his first -- >> first of all, i don't think anyone thinks this president is not a hard worker. and he went after the congress to what a ridiculous work schedules where the house and the senate take different breaks, so you can't deal with the congress as a whole

second, $157 billion rescue package for greece which, for the first time, forced private investors in greek debt to accept losses. added to that volatile mix: a political crisis in washington that threatens to devalue u.s. treasury debt, the backbone of world finance. i sat down with christine lagarde this afternoon, three weeks into her tenure, at the imf's washington headquarters. >>adame managing directoring thank you so much for joining us. >> pie pleasure. >> warner: as we sit here right now the crisis other than the u.s. debt limit, the possibility of default still isn't resolved. you've talked about a possible spillover. what are the consequences globally to the global financial system if five days from now there still isn't a deal? >> well, you're right that there is quite a lot of concern out there. the global economy is clearly highly dependent on the u.s. economy because the u.s. economy is the first in the world and it's a major power in many respects. so to haved lead economy-- to have the lead economy uncertain about its debt ceiling is quite worrisome. and if you were to take

yeah, my little tragedy was positively greek in scope. >> reporter: fleisher was the stuff of myth from the start: a child prodigy raised in san francisco, who gave his first recital at age seven. and at ten began studies with artur schnabel, one of the 20th century's greatest pianists. when we talked recently at hisç baltimore home, fleisher spoke of schnabel's most important lesson. >> music has a structure even though you can't taste it, you can't touch it, you can't smell it. it's there. and a great piece of music, greatly played, is as palpable, as three dimensional as anything else in life. >> reporter: so you think of the composer as constructing the work and then your job as theçç player is to re-construct it? >> yes, in a sense to discover what his structure is. also, the role of the performer is in a sense a very dicey one. because in today's culture and today's society everybody wants to have a star. but in music, for example, the performer is indispensable but he or she is not the star. the music is the star. >> from carnegie hall, leon >> reporter: still, the music bus

from what i saw editing this, the earliest poetry coming out of the chinese and greek, and on through, really, there is this mystery at the heart of nature, not able to understand it. this is called "epilogue" by gottfried benn. "the drunken torrents are falling the blueness is dying now and the corals are pale as the water round the island of palau. the drunken torrents are broken, grown alien, to you, to me, our only possession the silence of a bone washed clean by the sea. the floods, the flames, the questions - till the ashes tell you one day: "life is the building of bridges over rivers that seep away."" find more about the new recommendations to offer millions of women free birth control. that's on our health page. and on indonesia, see a slideshow about the disparity between the growing middle-class and the populous nations poor. all that and more is on our web site, newshour dot pbs dot org. jeff. >> brown: and that's the newshour for tonight. on tuesday, we'll have a newsmaker interview with republican presidential candidate, ron paul about the budget, the debt and more. i'm

under that agreement, investors in greek bonds are asked to accept new debt at lower interest rates and for longer terms. fitch said the bond holders will take a loss and that constitutes default. on wall street, stocks finished the day with mixed results, but had a winning week overall. the dow jones industrial average lost 43 points to close at 12,681. the nasdaq rose 24 points to close at 2,858. for the week, the dow gained more than 1.5%; the nasdaq rose 2.5%. those are some of the day's major stories. now, back to jim. >> lehrer: and to the crisis in somalia, which is facing the worst famine in decades. the united nations warned today 800,000 children could die from starvation. international agencies want to send in more food, but al qaeda- linked militants vowed to block the aid. jonathon rugman of independent television news traveled to a refugee camp just outside the capital, mogadishu. a warning: some of the images in this report are very disturbing. >> reporter: ahmed is eight months old and close to dying of hunger. he lies in the lap of his father, abdi. the pair have travel

the greek coast guard turned back a boatload of americans who did try to put to sea. several hundred pro-palestinian activists hope to use the group of nine ships to break an israeli sea blockade. it was imposed after hamas militants seized control of gaza in 2007. last year, an israeli raid on a similar flotilla killed nine activists. those are some of the day's major stories. now, back to jim. >> lehrer: in syria, there was another friday of protests and deadly responses, with reports of another 24 people killed, but also some gestures of reconciliation. margaret warner has the story. >> warner: the nearly four- month-long uprising against president bashar al-assad showed no sign of abating today, with some of the largest protests yet. >> ir-hal! >> warner: in the city of homs, marchers thundered cries of "ir- hal", or "go", a demand echoing across the arab world this year, aimed at longtime rulers. elsewhere in homs, security forces fired on protesters from roadblocks. large crowds also turned out in most other major syrian cities, in the now-weekly protests after