Officially we are talking about the situation in the euro area and economic development in Europe today in Berlin at the meeting between Chancellor Angela Merkel and Italian Prime Minister Mario Monti. A meeting that fits into many other bilateral talks these days, almost routinely. The German government is currently not taking decisions, but is reflecting and waiting: first the report of the troika on Greece and then above all the sentence of the German Constitutional Court which on 12 September will decide on the legality of the ESM state-saving fund.
But the questions from the German side to the Italian premier are many: What happens in Italy after the end of the legislature? Who will be the next prime minister and above all who will respect the new government the commitments made by the Monti government? The increasingly thinly veiled criticisms of the European Central Bank's policy are a hint of German concern. First Jens Weidmann, president of the Bundesbank, then Jürgen Stark, former undersecretary for the economy and former chief economist of the Deutsche Bank from the pages of the Handelsblatt criticized the ECB's intention to buy - again - government bonds of EU countries in crisis. “We are getting closer to state funding,” said Weidmann and Chancellor Merkel he backed it up right away. The German fear remains that the peripheral countries of Europe will stop carrying out the rigorous course since the money from the ECB will begin to arrive almost automatically.
Saving the euro is out of the question in Berlin and no one is talking at the moment of a danger of intoxication for Italy as it was a year ago, when the markets reacted drastically. Since January, Germany and Italy had drawn closer again, just remember that the chancellor was very much hoping for a Prime Minister named Monti. But recently the bilateral climate is less harmonious. Berlin didn't like Monti's commitment to have more flexibility in rigor to carry on growth. Merkel felt bad after the long night of the Brussels summit at the end of June.
More than anything else, it irritates the political situation in Italy. A possible return of Silvio Berlusconi on the political scene has scared the Germans, the quarrels between the parties that support the Monti government and the complaints about the electoral reform are perceived with concern. But it is obvious that the Prime Minister cannot answer these questions, no one can. His task in Berlin will be to make a new attempt to revive confidence – from the chancellor as well as from foreign investors.
