With her insistence on deeply unpopular austerity measures, German Chancellor Angela Merkel has won few friends in debt-laden southern European counties.
Many saw in her tough stance and refusal to make concessions an unwavering commitment to the interests of her own electorate. But suggestions that she bowed to pressure from other euro zone leaders at a key summit last week have left her with new enemies , this time closer to home.
Merkel agreed at the summit to use the euro zone’s planned bailout fund to recapitalize struggling banks as well as allow it to buy bonds of ailing euro zone countries to ensure that their borrowing costs are not driven up to unsustainable levels.
Although she denied that she had been pressured into the decision, her apparent softening was heavily criticized in Germany, and even caused her ruling coalition to wobble when the leader of her sister party protested against the decisions taken in Brussels.
Hans-Werner Sinn, the head of Germany’s Ifo Institute, one of Germany’s most influential economic research institutes, will urge other economists to join him in publicly opposing the decisions taken at last week’s summit, German magazine Der Spiegel reported on Thursday.
According to the magazine, Sinn believes Merkel was “forced” to agree to the measures at the meeting in Brussels.
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