The World from Berlin 'There Is A Dangerous Economic Imbalance in Europe'

German Chancellor Angela Merkel has defended the Franco-German plan to push for a change to the Lisbon Treaty ahead of this week's summit. German editorialists back the need for reform but some are uneasy about the way Berlin is flexing its muscles.

German Chancellor Angela Merkel

German Chancellor Angela Merkel

Tensions are mounting ahead of a crucial meeting of European leaders this week, with Germany and France at loggerheads with both the EU executive and many other member states over their calls for further changes to the European Treaty.

On Wednesday the European Justice Commissioner Viviane Reding slammed a deal hashed out between French President Nicolas Sarkozy and German Chancellor Angela Merkel to push for changes to the EU law to allow for the suspension of the voting rights of member states who violate strict budget deficit rules.

"Coming up with illusions of new treaties looks completely irresponsible to me," Reding said in an interview with German daily Die Welt published on Wednesday. "Haven't they both understood that it took us 10 years to wrap up the Lisbon Treaty?"

Germany has threatened to block a package of reform proposals, to be presented by European Council President Herman van Rompuy at the summit this Thursday and Friday, if it doesn't get its way on alterations to the Lisbon Treaty. The irony is that Berlin supports the bulk of the reforms, with include plans to improve EU budget discipline and widen provisions for financial and political sanctions.

Speaking to the German lower house of parliament, the Bundestag, on Wednesday Merkel reiterated her position. She said that a "new, robust crisis mechanism for emergencies" was required to secure stability in the euro zone. "That will only succeed with a change to the European Treaty. The chancellor also defended her pact with Sarkozy ahead of this week's summit. "It is true that a German- French agreement is not everything in Europe," she told the Bundestag. "However, it is also true that without German-French agreement a lot of things don't happen."

Berlin has long been trying to find a crisis mechanism that would prevent the more stable states, such as Germany, from having to take on responsibility for the debts of member states that got themselves into trouble. Merkel wants a new type of emergency fund set up to replace the ad-hoc rescue fund for Greece and the rest of the euro zone that ends in 2013.

The plan to suspend the voting rights for those who flout the EU's rules has met with fierce resistance from many other member states. EU Economics and Monetary Affairs Commissioner Olli Rehn told reporters in Brussels on Tuesday that this would "not necessarily be in line with the idea of an ever-closer Union." He said that the European Union would prefer a permanent mechanism for crisis resolution that did not necessitate changing the EU law.

Germany argues that any changes could easily be incorporated when Croatia becomes the 28th member state. However, others warn that the prospect of trying to get all the member states to ratify any fundamental changes to the treaty would be an uphill battle, particularly as some countries would be forced to hold a referendum on the issue.

Luxembourg's Foreign Minister Jean Asselborn warned that "there is a risk that we will be plunged back into months and years of navel-gazing."

The German press on Wednesday is largely supportive of the need to change the treaty but many papers warn against Berlin imposing its will on the rest of the union.

The center-left Süddeutsche Zeitung writes:

"Even if the rest of Europe cries out in indignation, the chancellor will get her treaty change, because there is no other choice. It is unavoidable, and in the coming days presumably the EU foreign minister and members of the European Parliament will recognize the fact."

"While the arguments are difficult to deny, what about the political style? There is a perception in the majority of EU states that the Franco-German directorate is striking once again. Or that Germany is acting here almost as a European hegemonic power, the export champion, the giant of growth, one that is far too powerful."

"Europe has fallen into a dangerous economic imbalance. This is not a question of East against West or North against South. It is about a center that is increasingly setting itself apart from the periphery. It is about Germany that has developed a magnetic force -- at the cost of its neighbors. If next to its economic invincibility, the country cultivates a political claim to dogmatism, then this will provoke antagonism."

The conservative Die Welt writes:

"The European Union of today has become a union of savings and cuts. … Mutual mistrust reigns on the European stage. Since the Greece crisis it is rumoured that Germany, doesn't give a damn about the other member states -- apart from France -- that it is selfish and no longer shows solidarity with the rest of the EU. This claim is misguided because the other EU states, particularly those troubled states in the south, have consistently pursued their own national interests. And it was not anti-European, but wise and clear-sighted for Angela Merkel to want to have clear conditions linked to the rescue package."

"Nevertheless, it is true that the European project is faltering. Germany was not able to prevent the legitimate interest in protecting its taxpayers from pouring money into a bottomless EU pit from seeming like national insularity."

The Financial Times Deutschland writes:

"The no bailout rule doesn't leave much room for interpretation. Article 125 is unusually clear by European standards. No matter how one tries to read it, there is only one possible interpretation: The EU and its member states will not guarantee the debts of other member states."

"Diplomats in Brussels may claim they have found a legal way around this. Yet one need not wonder, in the face of this kind of bobbing and weaving, why the people have lost their trust in the EU. It is possible that the creation of a European rescue fund has already broken the rules. What is certain is that a long-term solution requires a change to the European Treaty."

-- Siobhán Dowling


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