THE VERY real difficulties Chancellor Angela Merkel overcame yesterday in the Bundestag in winning approval for new powers for the European Financial Stability Facility (EFSF) should put in proper perspective some of the nonsense we hear here about German “bullying” and dictating to bailed-out states. Should, but no doubt won’t.
In truth the willingness of her Christian Democrat (CDU/CSU) party, its liberal FDP allies, and the German taxpayer, as they see it, to bail out profligate Greece was not a given. And, true, in doing so Germany is acting as much in its own interest, protecting its own banks and its own interest in the survival of the euro zone, as out of pure altrusim. This was not charity, but nor should it be caricatured as a new imperialism. Our partner Germany, with generosity, reaffirmed its European vocation. Its leader, often accused of dithering, put her neck on the line and demonstrated real leadership.
Some 315 MPs from the government coalition voted in favour while 13 voted against, 10 of the latter from Dr Merkel’s party, and three from the FDP. But with strong support from the Social Democrat opposition, a total of 523 MPs voted for the Bill, and 85 against.
The dissidents did not stint on the hyperbole in the angry debate, Frank Schaeffler of the FDP even suggesting Germany was heading back to the days of communism: “We’re heading towards a monetary planned economy.” It had required serious arm-twisting to preserve the chancellor’s majority and governing authority – dissident Wolfgang Bosbach, the powerful CDU chairman of the parliament’s internal affairs committee complained that “in 40 years in parliament I have never experienced anything like it. It got really personal”.
The legacy of internal bitterness will not make Dr Merkel’s task in holding her government together any easier. And it appears that battle lines are already being prepared for the Bundestag vote for the permanent bailout mechanism (ESM), scheduled for the new year.
Germany will shoulder up to €211 billion of the EFSF’s €440 billion of guarantees, although critics in the parliament insisted yesterday that this would not be enough, that taxpayers would be asked for more. Finance minister Wolfgang Schäuble denounced the claim, but in truth, as he knows, he may be forced to return to the well all too soon. Work on leveraging the fund up to at least €1 trillion is under way though unacknowledged for fear of frightening the Bundestag. “There is a growing realisation, even among the more reticent, that the July 21st package is yesterday’s war, and we need to go further,” a senior EU official told Reuters.
But Berlin’s decision, joined by Cyprus, to bring to 12 of the 17 euro zone states which have given parliamentary ratification to the legislation, did reassure markets. Now only Slovakias vote looks politically difficult. “Today, we have a union where it is the slowest member who dictates the pace,” commission president Manuel Barroso complained to MEPs on Wednesday, arguing for a move to majority voting – for the Bundestag, and most others, however, most certainly a bridge too far.