BRUSSELS ? Germany's controversial suggestion of a European debt regulator with direct control over Greece's spending turned out to be such a touchy subject that Chancellor Angela didn't even mention the idea to the leaders at Monday's European Union summit in Brussels.
In what was seen as a blow for Germany's push for tighter European integration, national sovereignty appeared to have won the argument Monday.
Over the weekend, Germany had made a pre-summit call to give a powerful European debt watchdog direct control over Greece's budget decisions. Despite often stinging criticism over how Greece runs it financial affairs, having a foreigner directly run a nation's budget found no takers among the other leaders.
Even Merkel's staunch ally, Nicolas Sarkozy, who is so close that they have morphed into the diplomatic couple "Merkozy", could not back her.
"We cannot put a country under trusteeship and run it from abroad. It would not be reasonable, not democratic, and, in short, not efficient," Sarkozy said after the summit.
Going into the summit, German Economics Minister Philipp Roesler had suggested the EU should take over the "leadership and supervision" of Greece's budget.
Athens is teetering on the brink of a disorderly default and is seeking a key agreement to get a second euro130 billion ($170.43 billion) bailout. The country has been surviving since May 2010 on an initial euro110 billion package of rescue loans from other eurozone countries and the International Monetary Fund.
Greece must also cut its deficit further and push through painful public sector layoffs and sell off several state companies, and its partners are unhappy with the pace of action.
Still, a "Sparkommissar" in German_ or "savings Czar" ? was beyond the pale for Greece.
"Our partners do know that European integration is based on ... the respect of their national identity and dignity," Greek Finance Minister Evangelos Venizelos wrote in an angry retort.
"I am certain that the political leaderships of all European nations ? particularly bigger nations that bear increased responsibility for the course of Europe ? are aware of how friends and partners, who have joined their historical destinies, raise questions," he wrote on Sunday.
Merkel got the message.
"I believe that we are having a discussion that we shouldn't be having," she said entering the summit.
Other European leaders have said that the Commission, the EU's executive, needed the power to block bad spending decisions, but not only in Greece but also other highly indebted countries.
But taking over the leadership of budget went too far.
"It can only be put in place by the Greeks, in a democratic way," said Sarkozy.
Ever since Greece threw the eurozone into financial turmoil in 2009 when it admitted previous governments had played down the amount of debt, it has been criticized as a profligate nation living off the wealthy northern nations.
It has since committed itself, under often intense pressure, to slowly move back toward a degree of fiscal discipline.
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