In the first case, the German government is simply saying that others – and they are looking at Spain, Italy and Greece in particular – must be like them, or else; hence the proposal to force the 27 members of the EU to amend their national constitutions to require balanced budgets. To propose this in a recessionary environment sounds rather foolish especially when Germany has not proposed any growth policies, just crippling austerity which, ultimately won’t work to solve the multiple problems. Coupled with the trade imbalances that exist in the EU – which Germany seems disinclined to address – it is hard to imagine any solution that would satisfy Germany which did not require that its policy choices are mirrored in Brussels. If that’s the case, then the Eurozone is going to disintegrate and maybe even the EU.
The second German imposed decision arose at the EU-Ukraine summit. Blithely ignoring the Polish position that inducements work better than sticks, Germany engineered the summit so that the EU did not even initial the Association Agreement with Ukraine killing, for the time being, closer economic cooperation and letting Yanukovich off the hook. The reason for this rejection of even a small step forward was the German view that the Tymoshenko trial and imprisonment should bring the entire integration process to a grinding halt. Astoundingly, Germany ignored Tymoshenko’s call to sign the Agreement preferring to appear as a defender of human rights while obscuring the inconvenient fact that 1) it is joined at the hip with Russia for energy and investment; 2) it gets to work on pipeline projects originating with Russia; and 3) it gets preferential pricing by Gazprom.
The result is that the EU, run by Germany, has managed to push an important country like Ukraine closer to the demonstrably undemocratic Russia and has also failed to come to grips with the Eurozone/EU crises. Not a bad month’s work.