Germany vision for European country!

Angela Merkel in Berlin on 2 December - a speech that laid out the German vision to remake the euro bloc

"We have started a new phase in European integration," Angela Merkel told the Bundestag last week.

"There are no quick and easy answers. Resolving the sovereign debt crisis is a process and this process will take years."

Few people outside Germany cared much when the quiet and unassuming chancellor stood to address members in the cold and clinical surroundings of the German parliament on 2 December.

But her words were keenly awaited by the German political elite.

Indeed, the speech may eventually be seen as one of the defining speeches in the recent history of the European Union.

In it, Mrs Merkel outlined the German vision of the future of Europe.

As Europe's largest economy - and biggest contributor so far to the bailouts of Greece, the Irish Republic and Portugal - Germany's view going into this week's EU summit is crucial.

"This is all about avoiding the next crisis," says Martin van Vliet, the senior economist at ING Bank in Amsterdam. "It has little effect on this one."

In the current climate, Mrs Merkel's blueprint for the future of the 27-member EU - and the 17-member eurozone - may well be the only one that matters.

Fiscal union

Mrs Merkel has called for a new EU treaty - with more power in controlling the finances of wayward nations.

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"We aren't just talking about a fiscal union," she told German lawmakers. "Rather, we have begun creating one.

"We need budget discipline and an effective crisis management mechanism," she said. "So we need to change the treaties or create new treaties."

The German government wants the new treaty to allow the EU to veto national budgets in the eurozone that breach the so-called "golden rule" regarding deficits.

Mrs Merkel wants to introduce sanctions if budgets end up having larger deficits, and she wants the European Court of Justice to have jurisdiction over disputes.

Pushing to transfer more national authority to Brussels at a time when the entire European project often appears to be on the verge of collapse may seem like a brazen strategy, particularly as there were already rules in place to prevent the current debt crisis from getting to this stage.

The Growth and Stability Pact was introduced when the euro was agreed in 1992. It limits budget deficits to no more than 3% of a country's total economy.

And following the recession in the early 2000s, who was it that quickly violated the pact? Germany and France.

Even Germany's closest ally is wary of some of Mrs Merkel's proposed changes, and the European Parliament President, Jerzy Buzek, warned last Friday that treaty change could be divisive and "dangerous".

That is because a treaty change would have to be approved by all 27 states - and with some requiring referendums to give up sovereignty, it could get messy.

So in a press conference with the French president on Monday, Mrs Merkel said that the treaty change would be for all 27 members - or for the 17 members of the eurozone to sign it, and other nations to do so voluntarily.

And subsequent decisions on issues such as bailouts will be passed by qualified majority, not unanimity as it now.

Whichever is easier for all of you, seemed to be the German message.