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Helping Spain

July 19, 2012

Once again, the German parliament has found a large majority to back Brussels' efforts to save the euro. But DW's Peter Stützle warns that the consensus is already showing its first cracks.

Image: picture-alliance/ZB

Sometimes even a single word can be rather telling. German Finance Minister Wolfgang Schäuble chose his words carefully - he did not speak about a debt crisis, a euro crisis or a banking crisis; he spoke of a crisis of trust.

His line of reasoning was that the financial markets doubt that the Spanish government will be able to solve its banking crisis without jeopardizing its own solvency.  If the markets were not so jittery, Spain would have little problems stabilizing its banks on its own, Schäuble said.

That's why it was about enabling Spain to continue with its promising reforms. And that, Schäuble pointed out, was also in Germany's own interest. Otherwise, the lack of confidence might easily spread to other countries and in the end could even drag down Germany.

Schäuble said that the goal of all the measures was to enable countries like Spain to regain the trust of the financial markets in order for them to be able to refinance themselves at reasonable lending rates.

Peter Stützle
Stützle says the opposition did the right thing to back the aid for SpainImage: DW/Vincent Mosch

How much progress there's already been with that, he argued, could be seen by the fact that 25 out of 27 EU countries have agreed in the fiscal pact to a balanced budget amendment, committing themselves to not spend more than their income. If Schäuble is right in his assessment, Europe is right on track to winning back the markets' confidence.

But the problem is that there's another somewhat different crisis of trust – one that's getting more critical by the day. Namely, the trust citizens have that the string of rescue efforts will eventually work out. Their concern is that eventually their tax money is going down a bottomless barrel.

The opposition is accusing the government of not being honest with the country. But that way they are only adding to the peoples' worries – as is Germany's president when he calls on Merkel to better explain the euro rescue efforts.

Yet the problem is that there really isn't a better way to explain the problems – after all, nobody knows how things will develop from here, not even the governments. And so trust continues to falter.

Politicians are aware of that trend among their electorate – and it shows. Watching the Bundestag debate about the aid for Spain, it seemed that the tone between government and opposition was getting rougher.

It is in fact quite remarkable that the opposition did not get carried away with that sense of hostility but still lived up to its responsibility to act responsibly for Germany and for Europe.

Author: Peter Stützle / ai
Editor: Spencer Kimball