»Pact for the Euro«: Can the European Union overcome the euro debt crisis with the measures agreed in March?

The EU heads of state and government agreed a package of measures for overcoming the euro debt crisis at the EU Summit at the end of March. Georg Milbradt, Technical University of Dresden, believes that the measures will not solve the problems in the euro-zone. To be sure, the proposals deal with important problems, such as the level of public debt, private indebtedness etc., but they continue to be subject to political procedures with their known weaknesses. A real stabilisation of the euro area cannot be expected. Joachim Starbatty, Action Group for the Social Market Economy, sees the permanent rescue mechanism as "a further stage on an escalating intervention spiral". Andreas Haufler, University of Munich, argues that a concentration on the goal of preventing short-term financial market crises carries the risk, in acute crisis situations, of a creeping transformation of the temporary auxiliary mechanism into a permanent funding of highly indebted member states. In the opinion of Volker Grossmann, University of Freiburg, Switzerland, the rescue fund endangers the euro because of the enormous risks for the contributor countries. Markus Ferber, European Parliament, expects that the decisions will lead to an increase of pressure on the financially weak euro countries to consolidate their budgets and regain their competitiveness. On the whole, the decisions are an important stabilising signal for the global financial markets. Lüder Gerken, Stiftung Ordnungspolitik and Centrum für Europäische Politik, Freiburg, argues that the decisions will not solve the problems of the euro-zone. On the contrary, with them the last opportunity has been lost to link the abolition of the bail-out prohibition to rigid, real-economy reform programmes for the deadbeat national economies, particularly in southern Europe. For this reason, the adjustment of these economies has been pushed far into the future.