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By examining the relevance of solidarity, control and "moral hazard" in German and US American fiscal federalism, it can be shown that the clearly limited solidarity of US federalism is better able to assure a solid fiscal policy of its member states than the unlimited solidarity plus weak control in German federalism. The institution of a credible no-bailout rule is decisive for this result. A review of the emerging EU fiscal union, considering the same criteria, demonstrates that it resembles the German model with unlimited solidarity plus weak control more likely. In consequence, this new type of a European fiscal union is considered to have only limited chances of success. [ABSTRACT FROM AUTHOR]

The Euro crisis and the political measures to solve it have generated new cleavages towards European politics in Germany. Never before in the history of European integration have the parties in parliament been so divided regarding such an important issue. The article compares the situation interpretations, problem diagnosis and resolution strategies of the government and opposition parties in the German Bundestag from the first decisions on the rescue package for Greece up to the parliamentary voting on the extension of the EFSF bailout fund in the Bundestag on 29 September 2011. The results confirm the persistence of the pro-European basic consensus in the German party system but exemplify that the proposals on how to combat the financial crisis diverge significantly between the political camps. [ABSTRACT FROM AUTHOR]