This article explores how both the sovereign debt crisis and the European Union's response illustrate fundamental characteristics of contemporary European integration. In the face of an unexpected emergency, national politicians took the lead and pressed ahead with more integration. The long-term results though depend on national acceptance of not just the bailout provisions but also enforcement of debt brakes mandated by the new EU treaty. This means democratic politics at the national level will continue to have a fundamental influence on EU affairs, while the North/South split will co-exist alongside a more marked separation between countries inside and outside the Eurozone. In this context of increased political turbulence within the EU, there is likely to be only a limited window of opportunity for successful negotiation of a free-trade deal with the United States.