The head of the Luxembourg central bank was, at first, not even considered a leading candidate for the position, which was being vacated by a Spaniard and, Madrid assumed, would be filled by a Spaniard. But a caucus of northern European countries balked at putting another southerner on the board, so inflation hawk Mersch became their candidate.
That set off months of nasty backroom battles, where the Spanish insisted on compensation – at one point they held out for the head of the new €500bn eurozone rescue fund, which was supposed to go to German economist Klaus Regling – in exchange for acceding to Mersch. Luxembourg retaliated by holding up plans to give Spain more time to hit tough budget targets.
In the end, the northerners won out. Mersch was nominated, and Spain was left empty handed. Everyone thought the fight was over. Everyone thought too soon: this morning, the European Parliament announced it was postponing Mersch’s confirmation hearing scheduled for Monday because no women candidates were considered for the job. Read more