Germany's will to compromise

Germany is willing to bail out member states in exchange for tougher fiscal austerity and a suspension of voting rights, but Chancellor Angela Merkel's demand for permanent crisis-resolution mechanisms, together with changes to the Lisbon Treaty, and her open warning to speculators who may be jeopardizing eurozone stability, has had wide consequences.

Within Germany, Merkel's demands have calmed the electorate, which was unhappy with the Greek bail-out. They have also silenced the Social Democrat-led opposition, which has no better alternative to offer the country. Moreover, the Chancellor's vehemence has reminded the EU as to who really holds the cards within the Union, while at the same time providing a reasonable solution for crisis management.