Who will follow Merkel and Sarkozy?

6 December 2011 – Presseurop Adevărul, Rzeczpospolita, Postimees & 4 others

At a 5 December meeting in Paris, Angela Merkel and Nicolas Sarkozy agreed on a plan to save the euro from catastrophe, which they will be asking the EU’s 27 member states to approve at a summit on 8-9 December. The European press, however, thinks they’re not out of the woods yet.

The text includes plans to revise European treaties to enshrine the principle of strict budgeting, with “immediate” and “automatic” sanctions for states that run spending deficits of more than 3% of GDP. Paris and Berlin are also demanding the introduction of an “enforced and harmonised ‘golden rule’ on the level of Europe,” to enable individual countries to establish mechanisms to guarantee its observance of the requirement for balanced budgets. At the same time, ratings agency Standard & Poor’s announced that it was placing Eurozone countries, including six AAA-rated states, “under negative credit watch.”

In Madrid, El País described the agreement as “lopsided,” generally “insufficient” and “questionable” in each of its aspects, because there is absolutely no mention of solidarity and the sharing of responsibility:

El País, Madrid

It is insufficient because, in spite of what they have said, Merkel and Sarkzoy did not outline a plan for fiscal union […], but merely emphasised fiscal discipline. In the event of a boycott by some countries, treaty reform would be limited to the Eurozone but would cripple the EU by opening a Pandora’s box of interminable, and byzantine discussions over complex agreements that were 10 years in the making. But the worst deficiency is in the lack of detail about mechanisms that are urgently needed to overcome the crisis. There is only one reference to the early launch of the permanent European Stability Mechanism in 2012, a deafening silence on the indispensable role of the ECB, and a regrettable refusal on eurobonds. If the European summit [on 8-9 December] does not improve on this meager harvest, the joy of the markets will be short-lived.

“Berlin wins the day,” notes for its part La Stampa. Although pleased that Merkel and Sarkozy acknowledged the autonomy of European Central Bank President Mario Draghi, the Turin daily is disappointed that the agreement will be a setback for eurobonds, controversial European state government bonds. Otherwise, “there was nothing new” in a discussion that papered over major issues:

La Stampa, Turin

... what is most striking is what they didn’t talk about. The duo avoided discussing the ECB, which Sarkozy wants to engage in more active intervention and Merkel wants to pursue its policy of stabilisation.

In Portugal, Jornal de Negócios notes:

Jornal de Negócios, Lisbon

Those who know Europe are aware that Merkozy has outlined an uncertain strategy to win the battle against the immediate collapse of the euro, but they have reopened old wounds in the sovereignty and democratic credibility of European countries and the EU, which date back to the outbreak of the crisis in 2010.

For its part, rival daily Público argues that -

Público, Lisbon

Germany is preparing to Germanise Europe […]. Even if we accept that we will have to “reinforce and harmonise” fiscal and budgetary integration in the Eurozone, the Merkozy couple’s demands are reminiscent of war reparations. The defeated and afflicted will have to fulfill more and more requirements, but there is no requirement for effort, money or solidarity to help them.

In Estonia Postimees regrets that once again, “the leaders of European states have weakened European institutions”:

Logo – Postimees, Tallinn

All the initiatives to save the Eurozone have been coordinated via the European Council, an institution that has never been an organ of democratic governance. The European parliament must be given a greater say. A return to the Europe of nations would imply a setback for democratic governance, which on a global level will be several times more catastrophic than 9/11 or the wars in Iraq and Afghanistan.

Scepticism about the Merkozy plan was not confined to the Eurozone. In Bucharest, Adevarul resignedly remarks that the new Europe “will not be perfect and will not be poetry”:

Adevărul, Bucharest

Beyond the niceties of French politics, the fate of Europe is increasingly tied to Germany. […] Everything is articulated around the Eurozone, and countries that are not included in this core will have to fight to stay in step. Romania, Poland and the Baltic States will do this because it is in their interest. There is no other choice.

Finally, for Rzeczpospolita, the Merkel-Sarkozy agreement on the “stability union” is neither a step forward or a revolution, but an “old union mired in compromise”:

Logo – Rzeczpospolita, Warsaw

... if you could draw the word ‘compromise,’ they would have used it to replace the stars on the EU flag years ago. Without them, we wouldn’t have to wonder which country is going to fall first. But even there, a compromise can be reached. No doubt, we will shortly be informed that it is in fact possible to be part of the EU and outside of the EU at the same time.