Photo Gallery A Leader Goes Astray
German Chancellor Angela Merkel and French President Nicolas Sarkozy walking along the promenade at the seaside French resort town of Deauville last Monday during their bilateral meeting: Merkel gave in to French demands to forgo automatic sanctions for deficit violators. In exchange, France agreed to support Germany in creating a sustainable crisis mechanism for countries in financial trouble.
Luxembourg's Foreign Minister Jean Asselborn (left) and Prime Minister Jean-Claude Juncker (right) at a news conference at the end of the EU leaders summit in Brussels in September: After hearing the German change of position last week, Juncker quipped: "The stability pact may now have more teeth, but it's still not a complete set."
European Commission President José Manuel Barroso at a news conference in Brussels in September: Germany previously favored a proposal that would allow the European Commission, under Barroso, to automatically impose sanctions when a state violates the stability criteria. Last week, German Chancellor Merkel agreed with French demands that sanctions be imposed only by agreement of a qualified majority of the Economic and Financial Affairs Council (ECOFIN).
European Central Bank President Jean-Claude Trichet arriving at a meeting of Eurogroup finance ministers in Luxembourg last week: Trichet was visibly furious after hearing the German change in position. "You don't understand the seriousness of the situation," he said, adding that Germany and France were endangering the continued existence of the monetary union.
Graphic: Flouting the rules
