30 october 2010, the amazing mrs merkel

I am one of angela's biggest fans (13 feb), not least from seeing her at close quarters resurrect the european constitution virtually single-handedly. Less than a year after lisbon came into force, it is worth recalling the firm consensus then that this would be the last treaty for a very, very long time. Now though, it looks like everyone was wrong. In a modern day retelling of twelve angry men, it seems that angela went into last week's summit alone against 26 "nos", but came out with unanimous agreement for a new treaty to tighten eurosystem rules. Contrary to the common telling though, this is not a new treaty. There have been dozens of "treaty" amendments over the years, not least with every new accession. Most had painless ratifications. I myself helped amend the treaty when the new member states joined in 2004 to change the way of calculating countries' voting rights on the (interest rate setting) ecb governing council. Interesting one that: tiny luxembourg came out more powerful than poland, which has 80x the population. The point though is that the uk adopted it with the "ponsonby rule", meaning it was laid before parliament for 21 days. I monitored opinion closely: there was not one comment or colomn inch. This time around, we are going to road test lisbon's new mechanism of what I called "silent ratification" (p17). This would, for example, enable the permanent crisis mechanism to be established within the treaty's "no bail out" parameters, but would not allow member states' voting rights in the council to be truncated. The former will be designed to stop germany's highly sensitive constitutional court feeling the need to weigh in. There is the risk that an activist parliament could block it, not least as a negotiating chip for something else. Step forward the uk, whose parliamentarians have a host of such wants. However, the uk government should relatively easily be able to head that one off at the pass, and one would suspect the price of that is already negotiated. The precise amendment is going to be hard fought, germany's stance being to really accelerate euro area economic governance in the way that lisbon was designed to enable to happen if the backbone was ever found. We may be in that territory. Marvellous merkel may again have pulled an astounding rabbit from what everyone else saw as an empty hat - and if it does lead to tighter euro area economic governance, it may well be a rabbit that lays golden eggs.