Europe’s summit to end all summits

BRUSSELS – The latest crucial summit to save the euro got under way Thursday with a heatwave gripping Brussels and dire warnings that the fate of the continent was hanging in the balance.

"People throughout Europe are casting worried eyes towards Brussels, towards this summit meeting, because they fear that our European project is one step away from disaster," Martin Schultz, the president of the European Parliament told leaders as the two days summit opened.

He recalled that June 28 was the 98th anniversary of the shootings in Sarajevo that triggered World War I and ushered in "decades of hatred, war, genocide and the displacement of peoples" in Europe.

Schultz added his voice to warnings that the future of the euro and of the European Union itself could depend on the 27 EU leaders producing with a credible plan that eases short term economic pressure on Spain and Italy, and lays the foundations for closer union that would provide more permanent solution to the debt crisis.

The plan before EU leaders includes a complex mix of measures to give European authorities closer control over national budgets; a banking union to tighten EU-wide supervision of banks and guarantee savers' deposits; and eventually some form of "mutualization" of debt.

German Chancellor Angela Merkel was under pressure to drop opposition to the "euro bonds" under which Germany's economic strength would shoulder some of the debt burden of the euro zone's southern states. Hopes she would compromise were jolted by recent reports from Berlin, quoting Merkel telling a meeting that Europe would not have shared debt liability "as long as I live."

Merkel's hard line was putting immediate pressure on Italian Prime Minister Mario Monti as markets pushed up the borrowing costs on his country's bonds to six-month highs.

None of which bodes well for the atmosphere at the summit, or for the evening's entertainment as at least some of the leaders plan to take a break from the negotiations to watch the semi-final of soccer's European Championship which is pitting Italy against Germany. 

More from GloablPost: Merkande? Merkellande? Hollanderkel? Oh, never mind.