As if Merkel didn't have a difficult enough road ahead of her running up to September's elections, Berlin politicians have now signaled to coalition partners their interest in a bilateral movement away from austerity and towards stimulus in the form of low-interest loans and venture capital.
The fact that the finance minister and the chancellor are suddenly willing to do things that have been off-limits until now also has something to do with an internal Chancellery dossier from mid-May. The government headquarters had asked the ministries to take stock of the EU growth pact that was approved in June 2012 to support the austerity programs. The results were, in fact, supposed to demonstrate how well the German bailout strategy was working. But the officials' conclusions shocked even calculated optimists. In their report, they painstakingly documented that debt-ridden countries, especially those that have not taken advantage of EU bailout programs, have hardly made any progress in terms of needed reforms. Read more-
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