If the January deadline is met — a big if, given the web of complex and controversial issues entailed in designing an effective banking supervisor for the eurozone while meeting the objections of the 10 countries not in the currency — it will then take several months at least for the supervisory authority to be functioning.
That, in turn, means that it will be at least a year before the eurozone can tackle the sovereign debt crisis more fundamentally by pouring bailout funds directly into ailing banks without first lending to governments and worsening their debt burdens. The decision to take this action came in June at a previous summit but became swiftly engulfed in confusion and dispute. The meeting on Thursday and Friday failed to dispel the confusion and bring clarity.
All the signs were that, barring a re-eruption of the crisis in the markets, substantial eurozone action would have to wait until Merkel is probably re-elected to a third term in September next year.
The summit featured the first big clash in the three-year crisis between Germany and France, highlighting how the troubles over the single currency and sovereign debt have moved to the very heart of the EU.
Hollande's key aim was to speed up the establishment of the new banking regime, while Merkel emphasised "quality over speed" as part of her delaying tactics.
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