Germany approves a bigger European bailout fund
Chancellor Merkel wins a majority in parliament, but the public is more skeptical. More than a third of Germans think Greece, the recipient of two bailouts, should be kicked out of the EU.
In a closely watched vote today, Germany’s parliament approved an expansion of the euro rescue fund, giving some reassurance to financial markets that the eurozone crisis might be brought under control.
But the vote means more for Chancellor Angela Merkel – it is a vote of confidence and a test of her authority.
For weeks Mrs. Merkel lobbied intensely to win over skeptics from the two parties that make up her governing coalition, the conservative Christian Democrats and the liberal Free Democrats.
It was likely that Merkel would have won the vote anyway, because almost the entire opposition in parliament was in favor of the bill. But relying on the votes of the Social Democrats and the Greens would have been considered a sign of a weakened government.
In the end, the support from her own camp came through.
“This is certainly a victory for her,” says Arthur Fischer, head of the Berlin stock exchange. “It is a key vote, but it is one of many. The German constitutional court has, just a few weeks ago, made it clear that parliament needs to be involved in all budgetary matters. So the markets will take some joy out of this vote today, but she’s not out of the woods yet.”
Indeed, Merkel’s critics have not been silenced by the defeat.