Euro leaders toil over new debt plan

A full solution to the euro crisis could be outlined Monday, officials said, as they toiled to complete a new plan after admitting their last effort failed. The new outline, to be presented to the German Parliament, could also be delayed until Tuesday, officials said after European leaders failed to reach a promised comprehensive deal after a 12-hour meeting Sunday. They vowed a deal would be done when the European leaders meet in Brussels again Wednesday. Sunday's meeting was marked by tension and included French President Nicolas Sarkozy's dressing down of British Prime Minister David Cameron, European Union officials said. "We are sick of you criticizing us and telling us what to do," Sarkozy was quoted as saying after Cameron told the eurozone countries to "take responsibility" for handling the situation, Britain's Independent newspaper reported. "You say you hate the euro and now you want to interfere in our meetings," the officials quoted Sarkozy as saying. Britain does not use the euro but is part of the EU. Sarkozy also said current EU leaders could not be blamed for the mistakes of the past. The exchange was followed by a clash among the leaders over whether Wednesday's summit should include all EU states or just the 17 eurozone members, the newspaper said. Britain was eventually allowed to participate in a 1-hour preliminary meeting of the full EU contingent before the eurozone members work out the final arrangements. Eurozone countries are EU members that use the euro as their common currency and sole legal tender. German Chancellor Angela Merkel also spoke sternly with Italian Prime Minister Silvio Berlusconi in a separate meeting that also included Sarkozy, telling Berlusconi in blunt terms he must make "credible cuts" to reduce his country's $2.8 trillion debt, The New York Times reported. The debt amounts to about 120 percent of Italy's gross domestic product, and many economists fear Italy could be next to collapse in debt if it fails to make major budget cuts swiftly. Berlusconi, hobbled by sex scandals, said late Sunday he may call an emergency Cabinet meeting Monday, but earlier told reporters, "The Italian fundamentals are very solid." When Sarkozy was asked at a news conference if he had confidence in Berlusconi, he said he had confidence in the collectivity of Italian authorities, "political, financial, economic." The EU leaders did make strides on major points, Merkel said Sunday. The steps included a sweeping $139 billion recapitalization of European banks and a substantial restructuring of Greece's debts, in which Greece would default on up to 60 percent of its sovereign debt. There also was agreement on a need for a bigger eurozone bailout fund but a lack of consensus on how big it should be; and possible new efforts to entice sovereign-wealth funds in China, India, Brazil and elsewhere to come to Europe's aid, Merkel said. The leaders also spoke about strengthening eurozone fiscal rules to reassure markets similar debt crises cannot happen in the future, she said. Asian stock-market indexes were generally higher Monday ahead of the opening bells in Europe and the United States.