Debt crisis: public mood ranges from resigned to revolutionary

ΠΗΓΗ: GUARDIAN

Helen Pidd in Germany, Angelique Chrisafis in Paris Henry McDonald in Dublin Giles Tremlett in Madrid and Remi Adekoya in Warsaw

GERMANY

The euro crisis is boiling down to one key question: is Germany trying to rule Europe? Angela Merkel insists not, telling MPs last week that such an idea was "absurd". Nonetheless, on Tuesday an op-ed in Europe's best-selling newspaper, Bild, suggested the chancellor should be leading more and not less.

"Germany is learning how to lead in Europe – about time too," wrote Nikolaus Blome in the 3m-circulation tabloid. He dismissed as "cheap shots" much of the criticism of Merkel. "Whenever the chancellor doesn't rock the boat she is accused of 'weak leadership'. And when she – with France – tries to take the lead, she is accused of 'sabre rattling'." 

The latter accusation – Kraftmeierei in German, which can also be translated as "bluster" or "swagger" – was thrown at her earlier this week by Helmut Schmidt, the revered former chancellor from the opposition SPD party. He said what Europe needed from Germany was solidarity and understanding rather than muscle-flexing.

One businessman complained in the Süddeutsche Zeitung broadsheet that Merkel's plans for a fiscal union were too lily-livered. "United States of Europe? It's not enough!" ran the headline of a piece by Christian von Bechtolsheim, from the wealth managers Focam. Germany should be the EU's role model, he said, not the USA. A particular inspiration, he said, should be the Länderfinanzausgleich – Germany's "unfairly criticised" way of redistributing wealth from the country's rich south to prop up the ailing eastern states.

France

Those kind of sentiments might not go down too well in elsewhere in Europe.

Jean-Charles Noudell winced as he took his terrier for a morning walk past news-stands showing pictures of the happy "Merkozy" marriage. The French president and German chancellor grinned from the front pages, having agreed their new European treaty plan to protect the euro. French papers hailed the "historic compromise" as good news for Europe.

"But it's politicians just trying to pull the wool over our eyes again, isn't it? It won't change the black mood of pessimism in France, people can't afford their bills, salaries have stagnated, the economy's crocked," said Noudell, a Paris park keeper.

Pundits talk of France becoming a bit more German – balancing their budgets for the first time in 35 years – but not too German. But the debate has focused on how much Merkel has railroaded Paris into accepting her conditions.

"Germany is a country that always wanted to lead, a country of conquerors, a proud country which won't accept merely following behind. They've been stuck behind others since the war and now they'll do anything to be on top," said Noudell, who observed that Germany was not a model in everything – "its parks are a mess".

The debate in France has been tinged by a row over Germanophobia. French Socialists oppose the Sarkozy-Merkel deal on the grounds that a new European treaty would take too long to ratify and does not address how France actually deals with its troubled public finances. Accused by the right of "dangerous Germanophobia", key Socialists such as Arnaud Montebourg are unrepentant over comments complaining of German "nationalism" and likening Merkel to Bismarck, autocratic unifier of Germany.

In France, the timing of Sarkozy's treaty plan is crucial: presidential elections in less than six months (hence Sarkozy's talk of "fear" and "urgency" as opposed to Merkel's drive for slower, long-term solutions) and a very real fear of losing the coveted triple-A credit-rating.

Sarkozy has been trying to push through his austerity measures by telling France, which fiercely defends its social model, that it must be more like Germany. Now with tax harmonisation a very real possibility, French papers list comparisons with its economic powerhouse neighbour: Germany has lower unemployment but no minimum wage, lower taxes on business but marginally higher on individuals, lower public debt than France but more poverty.

On the street, the feeling is Sarkozy still has far to go to sell the treaty to a population sceptical of his policies at home and distrustful of economics. "This won't change the real mood of anger in France, particularly outside Paris," said Laurent Betremieux, an artist. "Both Sarkozy and Merkel are still propping up a capitalist system and the markets who are making money out of this crisis. The mood here is so desperate that if something sparked people to take to the streets together, you feel there could be a revolution."

Ireland

In Finglas, a working-class suburb of north Dublin, there were rumours swirling around that the Irish state was reprinting the defunct Irish punt just in case the euro collapsed.

the indicators of economic hardship are everywhere with shops and pubs boarded up, only a trickle of shoppers braving the freezing temperatures and sale signs everywhere. Outside Connolly's fish shop, Siobhan Aspell wondered if the old currency everyone thought was dead and buried would have to be resurrected.

"The way this country is going I suppose anything could happen," she said as a pair of pensioners shivered in the December cold. "Surely we have lost our independence anyway but I wouldn't be surprised if the punt came back. It's hard to imagine it but at least it would mean we could control our interest rates." If Friday's crucial EU summit resulted in a fresh European treaty, Aspell said she would vote against it this time.

"Do I want the Germans to have more power over us? No. I would vote against even though Irish people are afraid."

Reflecting that fear and uncertainty given the latest austerity budget and the seemingly never ending recession, Aspell said many of her customers had lost faith that the EU would continue to shore up the Irish banking system, which has absorbed billions of Irish and European taxpayers' money. "There is a man who comes into this shop every Saturday morning whose wife recently passed away. When he was going through his house after her death he found thousands of euros under the mattress, in tins and boxes because she didn't trust the banks."

Huddled near a kebab shop with Perry Como's Christmas songs booming from a PA across the drab commercial centre of the village, Ken Murphy was resigned to the Germans getting their way. "My instinct is to say no and say she [Angela Merkel] should not get her way. We will definitely lose more of what's left of our sovereignty. Personally, if there was another referendum I would vote against the EU now and even the euro. We are losing too much as it is."

So what about another alternative – to rejoin sterling and tie the Irish economy closer than ever to the UK?

"I don't know if I'd accept the English pound to be honest. We would still have to our currency but I think the majority of Irish people are resigned to the big powers like Germany getting their way."

Inside Dolan's butchers, a business that has been based in the village for four decades, Michael Dolan was stoical about Ireland ceding more economic independence to an increasingly German-dominated EU.

"He who pays the piper calls the tune," the surprisingly jovial butcher remarked.

"Whatever they [the Germans] want, once they throw a few euros under our door we will vote for anything."

Dolan said he would not vote in any possible new referendum but accepted that the Irish would eventually have to acquiesce to German demands.

"We needed the money the Germans gave us the money to pay our police, nurses, civil servants so she [Merkel] will get her way. Ireland is borrowing millions per week to pay for our public services. Where is that money coming from? It's not flowing from the tax revenues here in Ireland. If we are honest, we could not afford all those services and pay the wages of those people without the Germans."

He sounded one note of resistance regarding Ireland's low corporation tax which at 12.5% is regarded as one of the main enticements for foreign direct investment setting up in the Republic.

"If Mr Sarkozy got his way and we had to give up the low corporation tax, then all the multinationals would leave Ireland. Now that would be going too far," Dolan added.

Spain

There is resignation too in Spain, where There may be just four frantic days left to save the euro, but the streets of major cities fell silent yesterday as relaxed Spaniards shut their eyes to austerity and took much of the week off. There may be just four frantic days left to save the euro but two days this week are public holidays, bringing the country to a halt. Tuesday's holiday to mark the constitution and Thursday's rest day to mark the Immaculate Conception mean that . Many people take an extra day or two (or three) off to turn the week into what is called a "bridge" or a "viaduct" holiday.

Many factories and offices, along with some public services, have closed – just as Spain's economy dips into a second recession in three years.

While Spain rests, however, its future will be decided elsewhere – culminating in the EU leaders' summit on Friday. Like the rest of southern Europe, it expects to be told to impose even greater austerity on an already suffering economy. "We are in a 'bridge' week and so we won't even be aware of how our future is being decided," said Iñaki Gabilondo, a commentator for the Prisa media group. "But we citizens already have the impression that we don't really count that much."Some Spanish factories close for all of the December "viaduct" week, as it is not viable to stop and restart production so many times during the week – especially when many workers want to take extra holiday days. Schools in many regions take their own "bridge" holiday by making Friday a school holiday – and forcing parents to take that day off as well. Government offices and small businesses often also grind to a halt. Employers and austerity campaigners want British-style bank holidays on Mondays, saying that will help the country boost productivity and start growing again.

"The 'bridge' holiday in December is a complete scandal," said Joan Rosell, head of the country's employers' association. It claims that, if the economy closes down completely, the week's holiday could cost the country more than €1bn, or one percent of GDP.Among other dates Rosell wants moved are some that, for varying reasons, Spaniards consider sacred. They include the traditional Christmas gift-giving day of Epiphany on 6 January, along with Easter Thursday and the May day labour holiday.

A study by the Randstad employment agency reveals that 70% of Spaniards would be happy to move some public holidays to Mondays.

Spain's holiday week coincides with a period of government stagnation. Mariano Rajoy led his conservative People's party (PP) to victory at a general election on 20 November, ousting the socialists of prime minister José Luis Rodríguez Zapatero.

Rajoy has promised yet more austerity, but will have no voice in the EU meeting on Friday.

Regional governments run by his party have already signalled that they will lower civil service salaries and increase the length of working days next year.

Poland

Poland, a nation partitioned for 123 years only to fall under Soviet control for another half-century, is understandably concerned about closer integration within the EU. Radosaw Sikorski, foreign minister, caused uproar last week when he called in Berlin for closer ties, specifically appealing for Germany to lead and saying he "feared German power less than German inactivity".

Poland is the biggest mainland EU country not in the euro but Sikorski said Poland would fulfil the criteria for monetary union by 2015 and "planned to join" despite its manifest problems. The prime minister, Donald Tusk, and President Bronisaw Komorowski both support Sikorski's ideas.

Ordinary people are not so sanguine. A recent poll showed that 53% of Poles think joining the eurozone would be disadvantageous for the country and Sikorski's big picture view of Poland's position in Europe has not been well received – the conservative opposition who have accused him of "longing for the Fourth Reich".

"Both sides are playing on emotions. It is easier to throw around words like sovereignty and independence when in actual fact it is very difficult to explain those notions in today's inter-dependent world," said Sergiusz Trzeciak, author of the book Poland's EU accession. He said he does not think most Poles will buy the conservative line but many are still sceptical of German leadership in Europe.

Adam Winiarski, 32, a secondary school teacher who lives in Warsaw, said: "It is outrageous that a Polish minister should be publicly weighing the idea of renouncing the sovereignty of his own country. All the more so, if he does it in Germany, independence from whom Poland so often had to fight in the past."

But members of what is broadly referred to as the "liberal-leftist" media generally support the government's efforts to stay on the German bandwagon. Jacek Pawlicki, of the newspaper Gazeta Wyborcza, said: "What is most important for Poland is that the new European deal be open for countries outside the eurozone … Merkel had promised that to Poland."

However, Sikorski also said in his speech that Poland did not support the idea of unifying tax policies across Europe, saying that should remain "in the purview of the state".

So despite disagreeing on some of the German and French proposals for rescuing the eurozone from the current crisis, it is clear that Tusk's government is doing everything to make sure Poland is not left out of future EU decision-making processes. This seems a logical enough strategy, especially in view of the alternative.

As the PM told MPs last month: "You are either at the table or you are on the menu."