Should we let bygones be bygones in the discussion on eurozone governance? Does it matter that Angela Merkel is taking a different position on the eurozone today than she did during the sovereign debt crisis? My answer to those two questions is no and yes respectively. No, we should definitely not forget her role in the past crisis. And yes, the shift matters.
Ms Merkel bears her share of responsibility for a situation that left the eurozone on the brink. It was her government’s decision in 2008, right after the collapse of Lehman Brothers, to refuse joint European bank rescues. The following year, it passed a constitutional balanced budget amendment, also known as the debt brake. This act of unilateral fiscal retrenchment was followed by years of austerity in Germany and the eurozone. During that period, the eurozone generated unsustainable imbalances — internally and against the rest of the world.
At the fateful meeting of EU leaders in June 2012, Ms Merkel rejected ideas for deeper political and economic integration. This failure later prompted Mario Draghi, the former president of the European Central Bank, to take ownership of the future of the euro — a necessary decision, but one that caused problems of its own, not least consecutive legal challenges from Germany.