military experts
EnglishРусский中文(简体)FrançaisEspañol
Set as default language
 Edit Translation

Lightning strike in Karlsruhe, or the end of European solidarity

Lightning strike in Karlsruhe, or the end of European solidarity

Berlin does not want to finance weak EU economies for free

The political crisis is gaining momentum in the European Union, which questions the very existence of the eurozone. The German Federal Constitutional Court in Karlsruhe ruled, that buying up by the european central bank (ECB) Italian government bonds, Spain and several other EU countries, particularly affected by the epidemic COVID-19, partially contrary to the German constitution. Constitutional Court bans Bundesbank from participating in ECB buyback programs, if the council of the bank cannot prove, that his actions do not contradict the ban on monetary state financing, when the central bank directly finances the budget deficit.

Lightning strike in Karlsruhe, or the end of European solidarity

German Federal Constitutional Court in Karlsruhe. A photo: REUTERS/Ralph Orlowski

Karlsruhe court ruling could frustrate Angela Merkel and Emmanuel Macron’s plan to demonstrate European solidarity. This plan was challenged in the German Constitutional Court by two parties - CSU and "Alternative for Germany" (AdG). "German capital opposed the strengthening of European solidarity", - writes French L’Humanite, Noting, that the German ruling class is almost ready to make an alliance with those, who promotes “The idea of ​​a return to the good old national currencies”.

In March 2020 the ECB has invested 33,75 billion euros in the acquisition of debt obligations of the euro area as part of a program for the purchase of government bonds of the EU. About Italian government bonds were spent on the purchase of 12 billion euros - much more, what the ECB rules provide. Besides, European Central Bank Acquires French and Spanish Bonds.

Court ruling in Karlsruhe reflects opposition in the highest echelons of power in Germany, where the dominant tendency to support the euro is adjacent to the mood of Euroscepticism. Proponents of the first approach are convinced of the usefulness of a single Euro currency for large German holdings-exporters. German Chancellor Angela Merkel and European Commission President Ursula von der Leyen adhere to this position.

Lightning strike in Karlsruhe, or the end of European solidarity

European Commissioner Ursula von der Layen. A photo: Olivier Hoslet Pool via REUTERS

Claimants to the Constitutional Court in Karlsruhe, former head of the Bavarian branch of the CSU Peter Gauweiler and one of the founders of AdG, economist Bernd Lucca, reflect the interests of those circles of German big business, who oppose the transformation of Europe into a transfer union, when richer member countries finance less affluent.

Peter Huber, one of the members of the Constitutional Court in Karlsruhe, He stated, that the ECB should not consider itself the "ruler of the universe": “The European Union is not a federal state. Union law does not have absolute priority over the legal systems of member states. From the perspective of the Chairman of the Commission, von der Lajen, European law always applies without any restrictions, it is not right".

Huber’s position was vigorously supported by the leaders of the parliamentary faction of AdG, which issue press releases almost daily, whip "Frau Chancellor". A recent press release by leaders of the parliamentary faction: “Say no to the Merkel-Macron reconstruction fund at the expense of our children and grandchildren”.

AdG Beatrix von Storch, deputy chairman of the parliamentary group, is outraged, what “Southern EU states should not even return money. This is Brussels' direct support for the insolvent budgets of the southern countries.. As an AdG parliamentary group, we reject Merkel’s “great effort” at the expense of Germany ”.

Peter Beringer, The official representative of the parliamentary faction “Alternatives”, adds: “With this step, Merkel calls on the entire EU to break the law ... None of the EU treaties provides for EU debt powers. EU Member States Debt Competence, because the European Union as a confederation is not sovereign ... That, what's going on here, - not only a coup by installments, but also the introduction of a new kind of socialism ”.

The struggle of German national liberals against the support of weak economies of the EU has been going on for the past decade. AT 2015 the then Minister of Finance of Germany Walter Schäuble, who is now the head of the Bundestag, forced Greece, which was on the verge of default, sign austerity policy memorandum. "Then everyone thought, that he is blackmailing the country “greksite”, although he actually united the other members of the Eurogroup against Athens, blackmailing… “germanexit”», - says former Minister of Finance of Greece Yannis Varoufakis.

The current version of "germanexite" is different from the situation 2015 years only, that the EU intends to save the declining economies of the "southern EU countries" almost free of charge and without setting conditions for the recovery of the economies of Italy and Spain. German right versus.

Lightning strike in Karlsruhe, or the end of European solidarity

The head of the ECB (from 2019 of the year) Christine Lagarde (in the center) and US Fed chief J. Powell (case) A photo: REUTERS / Marcos Brindicci

French portal Atlantico notes, what's the court ruling in Karlsruhe, “Besides a legal problem creates a political problem, because it gives rise to a sensation, that today's Europe is Germany ”. France Culture fears, that other countries may follow the example of Germany: “This decision threatens not only the euro area, but also the legal framework of the European Union. If a German court goes so far, other national jurisdictions (someone thinks about Poland and Hungary) may consider themselves entitled to do the same with respect to not only monetary matters ”.

Poland, by the way, welcomed the decision of the German Constitutional Court. Polish Prime Minister Tadeusz Moravecki called him “One of the most important court verdicts in the history of the European Union”.

Lightning strike in Karlsruhe, or the end of European solidarity

France's oldest entrepreneur Jean Francois Henin

Famous French entrepreneur Jean Francois Henin compared the decision of the court in Karlsruhe with a lightning strike: “Under pressure from public opinion, Germany refused to bear responsibility for the growing debts of all European countries, considered too weak. [France] a bold and credible government is required, so that our citizens understand this situation and its consequences. There are only two ways to solve the problem.: either the collapse of the euro (and Europe?), or adoption of austerity rules by all weak countries (including France) with all the difficult social costs ”. According to Henin, if Germany cannot impose austerity rules on all EU countries, she will leave the euro zone.

The European Commission immediately responded to the decision of the German Constitutional Court and is going to conduct an investigation. The final word in the European legal system should remain with the European Court of Justice in Luxembourg and “no one else”, European Commission Vice President Vera Yurova. European Commission President Ursula von der Leyen also speaks about the need for an investigation. According to EU law, The European Commission may impose sanctions against Germany.

There have been several cases in the history of the European Union, when the constitutional courts of the EU member states tried to oppose the decisions of the European Court of Justice in Luxembourg. However political pressure, usually, turned out to be enough, and no sanctions were imposed. Only once has the European Executive introduced such a procedure against a Member State in 2018 year - against France. Paris then submitted to the European Court.

Director, Columbia University European Institute (USA) Professor Adam Ace offers a deeper look at the situation. He's writing, that the German rebellion against the European Central Bank marks the end of an era of independent (from the state) central banks: "An open and insoluble conflict between the Bundesbank and the Constitutional Court of Germany, one side, and the ECB on the other, exacerbates tensions in the eurozone on the emergency financial response to the crisis COVID-19. The resentment in Italy and Spain on Germany is growing ... For decades, the policy of monetary authorities has been regarded as technical, not political. The pandemic will end this illusion forever. ”. Adam Ace sees no way out of crisis. In his opinion, those political forces in Germany, who referred the case to the Constitutional Court, will move on.

Today, German judges demand, for the ECB to justify the redemption of government bonds of EU member states within three months. In case of refusal to do so, they threaten to ban the Bundesbank from participating in ECB assistance programs. This will lead to an immediate increase in interest rates in Italy., Spain, Greece, France. Will it survive the euro? Ursula von der Layen threatens, that the European Commission will impose sanctions against Germany for violating EU law.

The title photo: German Federal Chancellor Angela Merkel, REUTERS/POOL New

Vladimir PROKHVATILOV

A source

                          
Chat in TELEGRAM:  t.me/+9Wotlf_WTEFkYmIy

Playmarket

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 comment
Inline Feedbacks
View all comments