Germany's desperate plans spark fears over 'economic occupation' in Europe

Page last updated at 05:04 GMT, Tuesday, January 31, 2012 - 10:04 EST

Huffington Post UK:

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Greece roundly rejected a German plan, revealed last week, to hand power over the country's budget to the European Union as its failure to push through economic reforms continues to endanger the stability of the eurozone.

That same weekend, German Chancellor Angela Merkel said that she would be prepared to actively campaign for her French counterpart, Nicolas Sarkozy, as he prepares to fight off a strong challenge from Francois Hollande - his socialist rival who has promised to renegotiate the EU's hard-won agreement over a continent-wide fiscal compact.

Sarkozy dismissed the reports, saying that he was unaware that Merkel was able to vote in France.

The damage may have been done. Both incidents highlight the concern that a new fiscal union is creating a momentum that will inevitably lead to an erosion of sovereignty in individual countries in the eurozone, and that electorates will begin to lose influence over their economic affairs. While appearing rational from a Northern European perspective, such reports play into a long-running suspicion in the periphery that the economic dominance of Germany may lead to it imposing its own social and economic models on the south.

It is a dangerous game. While the French may support European integration and the Greeks want to remain in the euro, would they buy into the vision if it meant giving up control over their internal affairs?

Read the whole story: Huffington Post UK