The week Europe turned a corner?

The week Europe turned a corner?

With the events in North Africa and the Middle East this week, it’s been easy to miss major developments North of the Mediterranean. First, there was some news out of Germany: 

Germany’s supreme court has rejected petitions to block ratification of Europe’s $640-billion rescue fund, giving the go-ahead for a key element of European leaders’ strategy for combating the continent’s long-running debt crisis.

The constitutional court was petitioned by 37,000 Germans who argued that the European Stability Mechanism, or ESM, contravened the country’s constitution.

In what was viewed as one of the most important decisions in the court’s 61-year history, the justices dismissed the petitions but imposed some significant conditions on the use of the ESM, namely a limit to Germany’s liabilities.

The decision will allow the European Central Bank to buy bonds from countries like Italy and Spain that are struggling with high interest rates. Chancellor Angela Merkel has backed ECB Chief Mario Draghi’s bond-bying plan. Jacob Heilbrunn sees this as a sign of Germany returning to its historic role as a European hegemon, a development that should at least make George Soros happy.

Yesterday also saw an electoral victory for pro-European parties in an election in the Netherlands, seen as a bellwether for European public opinion:

Prime Minister Mark Rutte claimed victory for his liberal VVD party. Centre-left Labour came a close second. Both parties performed better than predicted, seeking a pan-European solution to the eurozone crisis.

Dutch voters returned to parties of the centre, following recent elections which produced highly fragmented results and multi-party coalitions.

(In a week where religious conflict was topic A, it also seemed telling that Geert Wilders’ Freedom Party lost nine seats.)

Taken together, the week’s events seemed to indicate that, for better or worse, Europe’s leaders and citizens are intent on keeping the eurozone together. What they do to fix it is another question.