More than half the countries in the European Union have changed leaders since the region's sovereign debt crisis erupted three years ago, but Angela Merkel has not only remained in charge -- as the steward of Europe's largest economy, she has become the continent's chief crisis manager. And Merkel, long known as "Frau Nein" for opposing efforts to bail out Europe's troubled south, finally seemed to embrace that leadership role in 2012, prescribing a mix of austerity measures, structural reforms, and fiscal integration. She has tacked on mandatory spending cuts to aid packages for Greece, Ireland, and Portugal and spearheaded a historic EU deficit-reduction treaty. All along, the much-misunderstood Merkel has insisted on solving the regional crisis with more Europe, not less.
Yet she has done it by deftly catering to the frugal instincts of her political base. "We all have to resist the temptation to finance growth with increased debt yet again," Merkel cautioned in June. A month earlier, France had elected François Hollande, who supports the very solutions -- stimulus spending and collectivizing eurozone debt -- that Merkel opposes. Caught between European leaders' renewed focus on growth and domestic opposition to bailouts for Germany's debt-saddled neighbors, Merkel finally backed a new European rescue fund and the European Central Bank's plan to buy the debt of troubled eurozone countries.
What all her moves have in common is a relentless determination to resolve Europe's gravest crisis since World War II by deepening the continent's economic and political union, not unwinding it. Inspired to pursue politics by the fall of the Berlin Wall and EU architect Helmut Kohl, Merkel the onetime East German physicist often cites German reunification as an object lesson in Europe's ability to overcome. "Do we dare to be more European?" she asked this year, advocating for more centralized decision-making on budgets and taxes. The answer could very well determine whether Merkel will be remembered as the savior of the European project or the leader who presided over its demise.
KNOCKED OUT: 15 of the EU's 27 member states have lost leaders thanks in part to the eurocrisis. The list includes: Ivars Godmanis (Latvia, 2009), Ferenc Gyurcsany (Hungary, 2009), Mirek Topolanek (Czech Republic, 2009), Gordon Brown (Britain, 2010,) Brian Cowen (Ireland, 2011), Jose Socrates (Portugal, 2011), Mari Kiviniemi (Finland, 2011), Lars Lokke Rasmussen (Denmark, 2011), George Papandreou (Greece, 2011), Silvio Berlusconi (Italy, 2011), José Luis Rodríguez Zapatero (Spain, 2011), Emil Boc (Romania, 2012), Borut Pahor (Slovenia, 2012), Iveta Radicova (Slovakia, 2012), Nicolas Sarkozy (France, 2012).