Merkel Stamps Her Style on Europe's Crisis Talks

Posted by: Ben Vickers on October 28, 2011

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Angela Merkel has stamped her particular style on the EU crisis debate. Her flair for negotiation and compromise is what you might expect from the head of a country that in 17 elections held since 1949 has never voted in a majority government. All eight chancellors of the German federal state elected since World War II have headed coalition governments. The German political culture is one of consensus and slow but sure negotiation to achieve stability and attain long-term goals.

Contrast that with other European leaders. France’s Nicolas Sarkozy comes from a country where majority governments have long held sway. French politics are not about compromise. It’s all or nothing. Sarkozy’s proposals, to make the EFSF a bank and use the ECB’s balance sheet to bolster the rescue fund, both of which were rejected out of hand, betray a different political style.

Contrast Merkel with Italy’s Silvio Berlusconi, his country’s longest serving premier. Before Berlusconi first came to power in 1994, the country had had 50 governments in 49 years. Berlusconi has brought some stability to the Italian government, it’s true, but he has had to survive 50 votes of confidence since he was last re-elected in 2008, according to the BBC. Italy cannot agree on its own direction for long, let alone take a solid stance on Europe.

And contrast Merkel with Britain’s David Cameron, who heads the U.K.’s first coalition government since WWII. Britain never joined the euro, and many in Cameron’s party wonder if it should ever have joined the EU at all. Cameron has accused EU bureaucrats of constantly attacking London’s financial center, Bloomberg’s Gonzalo Vina reports. Cameron made the comment as he traveled to Perth, Australia, where he was meeting Commonwealth leaders today. Of course, no such rebellion over the Commonwealth is likely — British politics is all about remaining at the center of business and cultural networks, however old they are. Being simpy another node in a euro bloc bent on compromise just won’t do.

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Financial markets are on the edge as investors await a solution to the European debt crisis. This blog examines the banks that hold billions of euros worth of Greek, Italian, and other sovereign debt; the governments that must pay off or refinance that debt; and the implications for the worldwide financial system if they can't.

Analyses or commentary in this blog are the views of the author and or commentators, and do not necessarily reflect the views of Bloomberg News.

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