Conceding that the decision to hold a vote could well go to the Irish Supreme Court, the official argued that a referendum has “nothing to do with democracy.” The Irish Times notes that –

While it is not absolutely clear which parts of the treaty were written to suit the Government, Irish officials are known to have sought scope to adopt strict new limits to debt and deficits in legislation rather than through the Constitution.

Nevertheless, Irish opposition parties including Fianna Fáil and Sinn Féin are lining up mount a legal challenge to force a vote, writes the Irish Examiner, in a context of increasingly bitter debates in parliament.

Irish Times European correspondent Arthur Beesley notes that while Ireland has been “no stranger” to “intrusive external oversight of its internal affairs” since the €85 billion EU/ECB/IMF bailout of 2010, the new treaty could bind the country to such oversight “forever.”

It is one thing, of course, to submit to the unforgiving writ of the troika in an emergency situation in which the State is shut out of private debt markets. It is quite another to accept the hands of future governments will be tied by Ireland’s expanding obligations to Europe – even when the State can stand on its own two feet again.

Beesley also suggest that if the mooted referendum were rejected, this “would seriously impede Ireland’s return to markets.”

More importantly still is the fact that countries which do not ratify the pact within 13 months will have no further right to aid from the permanent bailout fund of the European Stability Mechanism. Observers may well see something decidedly nasty in that provision, which was a German idea.

Although largely unaided, the Chancellor has succeeded in imposing the fiscal compact on her European partners in just two months, but from now on, notes Spiegel Online, she will have to contend with “the nasty image of an austerity commissar,” who “stirs up fears of foreign domination in Europe.”

At issue is the proposal to send a budget commissar to Athens to oblige the Greeks to take control of their finances. Spiegel dubs the measure "political poison“, while Tagesspiegel describes it as "an admission of failure” that will give added fuel to the Nazi comparisons currently flourishing in Greece.

If only it was simply a matter of historical insensitivity, then Germany’s jab at the Greeks could be remedied by adroit diplomacy. But that is not the case. The proposal clearly illustrates that there is no longer any desire to preserve the monetary community. Now it is a matter of rich against poor and the strong against the weak. […] The Greeks already have to deal with the the EU/IMF/ECB troika, and they have no need of another interloper to do up their accounts on a blackboard. The aid package currently under discussion is supposed to strike a balance between reforms and growth. And as such, it will require plenty of money, time, and even more importantly, trust.

The Prague daily does not believe that the Brussels summit has prompted a division in Europe, but instead argues that the event has highlighted “different points of view on integration that will allow everyone to take up a position of their choosing.” As it stands -

... the Czech Republic will not be seated at the round table, or in the anteroom (...). It prefers to “listen” through the walls of a minuscule room, from which it will be difficult to influence the course of events in Europe.

While at least four non-eurozone countries fear that a green-light for the treaty will depend on the “precise wording” of what promises to be a tricky legal text –

… [e]ven inside the 17-member eurozone, cracks emerged, with Irish opposition leaders calling on Enda Kenny, prime minister, to allow a referendum on the new pact – a vote that would almost certainly fail – and pro-EU opposition parties in the Netherlands attacking the minority government of Mark Rutte, prime minister, for his handling of the deal.

With a first draft anticipated before the holiday, Martin Wolf, the finance daily’s chief economic writer, dubs the “stability and growth union” an “instability and stagnation union”. This “orgy of fiscal austerity,” he writes, will lead to -

… long-term structural recessions in vulnerable countries. To put it bluntly, the single currency will come to stand for wage falls, debt deflation and prolonged economic slumps. Can this stand, however big the costs of a break-up?

Clegg, who initially appeared to back the PM’s summit veto, only to later declare he was “bitterly disappointed” and feared that Britain would become a “pygmy in the world”, justified his no-show by saying “I would have been a distraction if I was there."

For The Independent, traditionally close to the deputy PM’s Liberal Democrat party, this was “Clegg’s day of rage”. The prime minister and his deputy, the London daily writes -

… are at odds over whether the Government should move quickly to rebuild bridges with the 26 other European Union countries after Britain was left isolated at last week's Brussels summit.

[…] Both Conservative and Liberal Democrat ministers admit the Coalition faces the biggest crisis since it was formed last year.

For EU-sceptic the Daily Mail, Clegg’s “histrionics” are nothing short of “cowardly” –

Nobody expected Mr Clegg or the obsessively Europhile Lib Dems to be thrilled by Mr Cameron walking away from the Franco-German led talks in order to protect the City and other vital national interests... [But] the brutal reality is that … Mr Clegg exposed himself as a weak man.

The Mail also scoffs at the notion that the spat could lead to a Lib-Dem walk-out that could topple the coalition.

The polls point to annihilation if they walk away now and, besides, they like their ministerial cars too much.

Prime Minister Viktor Orbán justified his attitude, explaining that  "parliament will have to debate Hungary’s participation in the Eurozone member states’ agreement,  because it is a matter of national sovereignty".

Népszabadság points out that Orbán’s behaviour in Brussels has been prompted by domestic political considerations. On one hand, by forcing the pro-European opposition to support an agreement that will reinforce budgetary discipline, “Orbán wants to share  responsibility for austerity measures,” notes the centre-left daily. On the other, the Prime Minister could take advantage of the situation to separate himself from the far right, which supports the government in parliament but is opposed to the agreement.

For its part, right-wing weekly Heti Válasz attacks the government with unusual virulence. “Orbán appears to be repeating the mistakes of previous socialist governments that were judged to be incoherent and incompetent,”  writes the magazine, which argues that the government has been discredited by its incoherent behaviour  and “can no longer be taken seriously.”

As a result, writes Jacek Pawlicki in the Warsaw daily,

We’re going to have two unions: a commonwealth EU of 27 and an integovernmental EU of 27 minus one [...] It is no use looking for culprits. [British PM David] Cameron’s tough stance, forced by internal politics, clashed with equally intransigent positions adopted by Berlin and Paris which stubbornly called for changes to the treaty [...] Once started, the process of “de-communalisation” (making the union less of a commonwealth of states) of the EU can’t be stopped. Its consequences can’t be predicted either.

However, argues Pawlicki, the birth of the new Union will not necessarily mean the end of the old one. Most key decisions concerning the EU budget or the common market will still be made among 27 members. Notwithstanding this, the new Union – concentrated around France and Germany – might prefer to take decisions on an increasing number of issues alone and only later discussing them with the other members. This, stresses GW’s columnist, “will lead to further divisions and isolationism – chiefly of the British and possibly later on of others”.

“One, a flagrant institutional vagueness. In fact, the member states have been ordered to implement major reforms. One sees that Europe is radically changing the look of sanctions and how they’re issued. The second point is the birth of fear. For the first time in half a century, the European space is no longer one of hope, but one of fear and worry for all its member states.”

“To deal with the crisis more decisively,” the Madrid daily writes, Van Rompuy proposes that the European Financial Stability Fund [EFSF] “recapitalise banks directly, and he does not preclude issuing Eurobonds in the long-term.”

For El País, Van Rompuy and Barroso -

... are finally getting to the heart of the financial problems plaguing Europe: an economy paralysed by the complete lack of credit due to the banks’ mistrustful unwillingness to lend.

The Commission, meanwhile, wants to strengthen budgetary control of the countries in the eurozone by gaining the right to –

... demand [of national parliaments] a revision of the draft budgets if the Commission considers that they fail to fulfil obligations under the Stability Pact.

According to the Belgian daily, however, this tack is “fraught with perils” because the heads of state and government (brought together in the Council) have a marked tendency to encroach on the European Commission’s remit. "In the past, Belgium has faithfully adhered to its tradition of eschewing the ‘intergovernmental’ approach and defending the ‘Community method’,” points out Le Soir, though recent months have seen “a slight falling-off, albeit nothing drastic as yet. But Belgium will have to be very wary in this regard if it is to defend an ambitious European project, and that vigilance will be a yardstick of the Belgian presidency’s performance.”

It will also be assessed on how it handles major business on its watch, first and foremost, points out De Standaard, the 4/5 October summit in Brussels between the EU and Asian countries (Asia-Europe Meeting or SEM for short), which will provide "a unique opportunity to put Belgium centre-stage”. During its stint at the helm Belgium should also set its sights on attaining "the financial stability” needed to break out of the crisis; use the climate conference in Cancún this December to live down the Union’s feeble showing at last year’s COP15 in Copenhagen, and implement the Stockholm programme to create a “European area of freedom, security and justice”.

This current emergency, which is likely to be one of many in an economic crisis that is not yet over, has marked the emergence of a geography of the EU. The markets, or more precisely some market players like the speculative funds that aim to undermine certain bond values, have become the de facto enemies of the European project. Right now their focus is on the weaker economies in the EU, but these economic players have demonstrated that they constitute an existential threat to stability everywhere in Europe. It is on this basis that the crisis has the potential to prompt a renewed drive to balance the creation of wealth and harmonise economic practices in Europe's 27 member states.

Having managed the economic life of the euro zone for years, notably through the setting of interest rates, the European Central Bank, which does not have a mandate to intervene in a situation like the current Greek malaise, has been forced to defer to the authority of Europe's member states. There are some problems that cannot be solved in Frankfurt. The same applies to the new European Commission, approved earlier this week, which played no significant role in the drafting of the rescue plan. As far as Brussels is concerned, the Greek crisis is a matter for the European Council.

Given that the United Kingdom remains outside the eurozone, London, both as a political capital and financial centre, has remained on the margins of discussions for decisions taken this week, which has reinforced the authority of the Paris-Berlin axis. It remains to be seen what Nicolas Sarkozy and Angela Merkel, who do not always see eye to eye, will make of their reinforced leading role.

The need for a common economic policy, which has long been postponed, is now more acute than ever. And there is plenty of evidence to suggest that an economic federation is beginning to take shape behind the borderless map of Europe's Schengen Area. In the wake of the snub constituted by the cancellation of Barack Obama's visit, the EU is embroiled in debate about the nature of its own future. In the bid to recover its prestige, it must take into account the new geography resulting from developments in the global economy, if it is to function correctly and reassert its authority in the arena of international affairs.  Eric Maurice