Der Spiegel reported Wednesday that former Chancellor Gerhard Schroder called Merkel's claim that investments in Greece were safe was "a very big lie."
The chairman of the Alternative for Germany party Bernd Lucke also weighed in, saying that Greece "should withdraw from the euro," Der Spiegel reported.
Reportedly, Merkel told members of the Christian Democratic Union party's executive committee that, "there is too much talk in Europe about debt haircuts," which some interpreted as Merkel suggesting that the subject be downplayed or dropped in an election year.
Finance Minister Wolfgang Schauble, however, let the cat out of the bag, Der Spiegel said, when he said later, "There will have to be another [bailout] program in Greece."
Schauble's comment has angered members of Merkel's Christian Democratic Union party and the Free Democratic Party, which is considered a component of Merkel's coalition government, as the issue adds up to a sensitive test of Merkel's ability to handle the international crisis, in which Germany has taken a lead role, Der Spiegel said.
German taxpayers are already on the line for $163 billion -- their share of loan guarantees awarded to Greece in efforts to protect the euro.
Last week, Schauble asserted, "there will be no debt haircut," referring to losses creditors might have to accept of Greece requires additional aid.
But the International Monetary Fund has said that creditors should agree to accept additional losses and Germany's central bank also considers another bailout inevitable.
The Bundesbank believes another bailout will be necessary soon after Germany's general election on Sept. 22, Der Spiegel said.
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