In the words of a senior EU diplomat deeply involved in the negotiations, it “seems to square the circle between northern and southern Europe.”

Hawkish Lindner

Even if Germany hasn’t got its way entirely, it has picked up some crucial concessions.

Originally, the Commission ― which polices the rules ― proposed that it should negotiate bilaterally with governments over debt and deficit reduction. But the latest draft compromise refers to the most indebted countries being obliged to reduce debt by at least 1 percent of GDP per year ― a key priority for Lindner, leader of…