Merkozy found a new partner yesterday when Spain?s Mariano Rajoy spoke out in a congressional meeting of the European Partido Popular in Marseille. The prime minister-elect of the Spanish government aligned his views with the Merkel and Sarkozy?s summit agenda.
Rajoy is asking that the debt crisis be fought rigorously with all available measures and resources, while brandishing the flag of balanced budgets, doing away with unnecessary spending and structural reforms, especially in regard to labor issues. Certainly, he believes in discipline as a route to economic recovery.
He will back Merkel and Sarkozy as they attempt to reform a treaty in favor of making EU unity the most important project for the future. Nothing but more problems similar to the ongoing sovereign debt crisis could compromise the pillars of the EU?s solidarity in the future.
But Rajoy still wants Spain to have blocking rights when the European Stability Mechanism goes into effect. In fact, Rajoy entrusted his predecessor Zapatero to go to the summit and stipulate a 90% cutoff for using the fund, including bank recapitalizations. With less than 90%, Spain would not be able to say no to the fund?s mandates.
It seems clear that Rajoy is very ready to untie Spain from ailing economies by committing to rigorous reform, serving in a band of those that are designing strategies for insuring that credibility eases the weight of our financing such that the reforms can refuel our slack economy.
