Good morning! Here’s what you need to know:
1. The Greek debt crisis continues to unravel. Wolfgang Munchau boils it down: “The eurozone has essentially three options: follow the ECB, and roll over existing debt for as long as it takes; change the rules of the EFSF and accept Brady bonds; or force a full debt restructuring, and accept the consequences. It is going to be one, two or three.”
2. The Financial Times reports: “Greek government has fallen sharply behind on payments to healthcare companies only months after restructuring its €5.4bn ($7.6bn) debt to suppliers, raising doubts about patient safety while revealing the looming cash-flow crisis faced by the state.”
3. Paul Krugman argues that “austerity policy” in Europe has been a failure and that continuing to pretend that it might work only makes matters worse.
4. French Finance Minister Christine Lagarde remains the front-runner to replace Dominique Strauss-Kahn as DIrector of the IMF. Ms. Lagarde has German support, which is crucial, as well as the support of Great Britain.
5. The conservative Popular Party in Spain yesterday made huge gains in local and regional elections, indicating that it will likely defeat the Socialist ruling party in national elections next year.
6. Tom Friedman had a smart column yesterday on the importance of Syria. Other nations in the Middle East and North Africa implode, he wrote. Syria explodes. What happens when it does explode, as it almost surely will, will be hugely consequential.
7. President Obama yesterday tried to reassure Israel and its supporters of “ironclad” U.S. support. Speaking at the AIPAC conference, Mr. Obama warned that time was running out for a peace accord with Palestinians.
8. Mr. Obama’s speech last week on the Middle East was viewed by some as having thrown Israel “under the bus.” Walter Mead explains why this view is utter nonsense.
9. Former Minnesota Governor Tim Pawlenty, in a video, announced today that he is a candidate for the 2012 GOP presidential nomination. Mr. Pawlenty’s strategy, so far, has been to present himself as the candidate you can support after you’ve decided you can’t support any of the others.
10. Indiana Governor Mitch Daniels (R) announced yesterday via email that he would not seek the 2012 GOP presidential nomination, saying that his family opposed a run and that therefore he could not do it.
11. While Mr. Daniels was getting out, former radio chat show host and Godfather’s Pizza CEO Herman Cain was getting in. For many Republicans, “Daniels Out, Cain In” was a resonant metaphor.
12. The special US Congressional election in upstate New York is very close, with new polls showing the Democrat holding an ever-so-narrow lead in what has long been a safe Republican District. National money is now pouring into the race. The election itself is tomorrow. Business Insider will have live coverage after the polls close at 9pm Eastern Time.
13. For those who believed that The Rapture would happen, the fact that the world did not end on Saturday was both disappointing and troubling. The National Journal interviews some of the shaken believers.