Sen. Jack Reed on European Union vote: 'We have to have worldwide growth...that is the new phenomenon in the world'

In an attempt to ameliorate its economic crisis, the European Union will vote next week on instituting a European banking union.

President Obama announced his support of the measure at the G-20 Summit in Mexico but German Chancellor Angela Merkel is standing in the way of the vote, saying she opposes the idea. Chancellor Merkel also opposes a stimulus for struggling European nations.

Sen. Jack Reed (D-RI) tells Soledad O'Brien on CNN's "Starting Point" that "[Merkel's] reluctance I think is eroding. It has to. The austerity is not working in Europe."

"I think Chancellor Merkel understands that politically they just have to find an indirect way to provide support for the European economy," Sen. Reed adds.

The E.U. vote could have a significant effect on the American economy and could be a factor in the November presiential elections. "We're in a global economy," Sen. Reed says. "The president has emphasized significant exports as a way to grow our economy...we have to have worldwide growth."