SGP 3 Update: The Franco-German Compromise

France and Germany seem to have reached a compromise over the SGP3. As Charlemagne describes it, the Germans seem to have dropped their "hawkish" demands about the semi-automaticity of fines at the preventive stage and in return got the French to accept supporting the German ideas of creating a debt restructuring mechanism for the Euro-zone and extending the EFSF forever. According to the communiqué, only the later of these proposals would require a treaty change. This was all agreed over the week end and came to light in the last day or so. The German press was not amused, and I am certainly not impressed. However, I leave more comments for later.