Tuesday 12 June 2012

achterbahn

Lending tacit support to the infusion of credit to Spanish banks by way of a demurring and quiet concession towards the pooling of debt, Germany bore some chinks in its armour of resistance to the notion of sharing responsibility for broader financial stability. Signaling (again so lightly as to miss this cue) that the machinery of the European Union might be willing to admit a bit of the chaos of democracy (wherein people might not be obliged to choose wisely), Germany advocated a stronger political union for governance of monetary issues, ceding control of budgetary competence to the EU board.

Necessarily such a decision could not be unilateral and only up to the will of EU functionaries but must be submitted to a vote, since radical changes in national sovereignty require amending individual constitutions and a new legal framework. Now, even as the soothing effects of the cash for Spain is evaporating and raising the ire of the public and other earlier aid recipients that are being made to feel categorically different, irresponsible and blameworthy, which I do not think was the reason behind the German compromise but rather fear that became face-saving for Spain’s banks, Germany has shown a willingness to entertain the democratic process before the voting public has wearied of the issue and the ideals behind the EU are sunk. Instead of inheriting a failed coalition, Germany hopes to install a carefully crafted framework that honours Teutonic stoicism and fiscal responsiveness. Agreeing to share the burden of new debt incurred (and no country in the soi-disant core of the EU can manage right now without taking on new debt) comes also at the exclusion of existing obligations, which I fear might make the union, after negotiations that delimit one’s jurisdiction, even harder to leave, should things take a turn for the worse.