All Hail The United States Of Germany? The Rest Of Europe Is Facing Either German Domination Or Financial Collapse

It has now become very clear who dominates Europe. As European officials prepare to gather for one of the most important summits in EU history, it has become apparent that either the German plan for a new EU treaty is going to be adopted or there is not going to be a deal at all. Germany wants to impose strict new fiscal restraints on all of the eurozone nations. This would include a new 3 percent budget deficit rule with automatic sanctions on any violators. The European Court of Justice would be given power to decide whether or not an individual nation was complying with the 3 percent rule or not. A highly controversial new tax on all financial transactions is also being proposed, along with a number of other repressive new regulations that are designed to more tightly integrate Europe. Germany says that if all 27 EU nations are not willing to go along with a new treaty then it is prepared to strike an agreement with just the 17 nations that make up the eurozone. But not everyone is thrilled with what Germany is trying to do. Critics are saying that the German proposals (which are also being backed by the French) would mean a massive loss of sovereignty for most of the nations that make up the eurozone, and they would essentially turn the eurozone into "the United States of Germany".

The funny thing is that the German proposals to "fix" Europe involve very little sacrifice from Germany itself. Germany would not be contributing any additional money to bail out the rest of Europe and Germany continues to completely rule out the creation of "eurobonds" which would help spread the risk of default across the entire eurozone.

Sadly, even if the German plan is adopted and all the nations in the eurozone agree to it, the financial crisis in Europe will still not be fixed.

There is still way too much government debt in Europe, and the new treaty would not reduce those debt levels. Instead, it would only slow the growth of future debt.

In addition, there are dozens of major banks in Europe that are already failing. The new treaty would do next to nothing to restore the European banking system to health.

Also, brutal austerity programs have already pushed several countries in Europe into recession, and more austerity measures are being introduced all over Europe right now. But this new treaty would not do anything to reverse that trend. In fact, this new treaty would actually force even more austerity on to the nations of Europe.

This is the approach that Germany has prescribed for Europe. The Germans believe that those that have gotten into too much debt must pay.

In fact, a newspaper in Germany recently ran an article with this startling headline: "Merkel and Sarkozy want automatic Punishment for Debtsinners".

Germany has become the dominant force in Europe, and Angela Merkel has emerged as the de facto leader of Europe. This reality was noted in a recent New York Times article....